Vishal Mega Mart Rs 8,000 Cr Mega IPO Opens On 11 Dec

The initial public offering (IPO) of Vishal Mega Mart opened on 11 December to raise a whopping Rs 8,000 crore from the public market. 

The Rs 8,000 crore IPO consisted exclusively of an offer-for-sale (OFS) component with the price band fixed at Rs 74 to 78 per equity share. 

The issue opened on 11 December and is scheduled to close on 13 December followed by allotment on 16 December. Subsequently, the IPO will be listed on the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) on 18 December. 

Kotak Mahindra Capital, ICICI Securities, Intensive Fiscal Services, Jefferies India, JP Morgan and Morgan Stanley are the book-running lead managers, while Kfin Technologies is the registrar to the offer. 

Brokerages Note

“At the upper price band of Rs 78, Vishal Mega Mart is trading at a PE of 69 times on FY25 earnings (annualised), which appears fairly priced compared to its peers and factoring in its high growth. Considering positive industry growth opportunities, the expected rise in demand, healthy store additions, and presence in the online channel, we assign a ‘Subscribe’ rating on a medium- to long-term basis,” stated Geojit Financials. 

“If FY 25 annualised earnings are attributed to its post-IPO fully diluted paid-up equity capital, the asking price corresponds to a price to earnings (PE) of 69.03. Based on FY24 earnings, the PE stands at 75.73, indicating that the issue is aggressively priced,” stated Bajaj Broking. 

IPO Objectives
The company will not receive any proceeds of the OFS by the promoter-selling shareholder. The promoter-selling shareholder will be entitled to the entirety of the proceeds of the OFS after deducting its portion of the offer-related expenses and the relevant taxes thereon. 

However, the firm will get benefits on listing in the public market which will enhance the brand’s visibility and provide liquidity to the shareholders. 

Firm’s Financials

In terms of financial performance, for the past three fiscal years, the company reported a total income of Rs 5,653.85 crore with Rs 202.77 crore profit in FY22 and revenue of Rs 7,618.89 crore with Rs 321.27 crore in FY23.

The company registered a total income of Rs 8,945.13 crore with net profit of Rs 461.94 crore in FY24. For the first half of FY25, ending September 2024, the company achieved a net profit of Rs 254.14 crore on a total income of Rs 5,053.42 crore.

The company reported profit-after-tax (PAT) margins of 4.24 per cent in FY23 and 5.18 per cent in FY24.