Baazar Style Retail IPO: GMP hints double digit listing gains for investors

Ahead of the listing, the unlisted shares of Baazar Style Retail were quoted trading at a premium of Rs 45, or 11.57 per cent higher than the upper end of the issue price of Rs 334

Baazar Style Retail IPO listing price prediction: As investors await the debut of Baazar Style Retail shares on the bourses, the grey market premium (GMP) indicates a favourable debut for the company's shares on the BSE and NSE, scheduled for Friday, September 6, 2024. Ahead of the listing, the unlisted shares of Baazar Style Retail, whose IPO allotment was finalised yesterday, were quoted at a premium of Rs 45, or 11.57 per cent higher than the upper end of the issue price of Rs 334, according to several sources that track grey market activities. 

The current GMP, however, is lower than the Rs 65 quoted on September 3, when the issue closed for subscription. Moreover, today's grey market premium of Baazar Style Retail is less than the GMP it commanded on the opening day of the public issue, which was recorded at Rs 126. 

Should the current grey market trends sustain, Baazar Style Retail shares may list on the BSE and NSE at around Rs 434 (upper end of IPO price + GMP). Thus, investors who have been allotted Baazar Style Retail shares can expect a gain of over 11 per cent per share upon listing.

Shivani Nyati, Head of Wealth at Swastika Investmart, said that Bazaar Style Retail is set for a positive stock market listing. According to her, the company's impressive growth trajectory, margin improvement, and robust financial performance bode well for its future. However, the IPO's valuation is on the higher side, which, as per her, could temper investor enthusiasm.

"While strong market demand is likely to support a positive listing, investors may prioritize short-term gains due to valuation concerns. A cautious approach is recommended, balancing the company's growth potential with the valuation risks," said Nyati.

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Available at a price band of Rs 370-389 per share, and a lot size of 38 shares, the public issue of Baazar Style Retail witnessed favourable investor interest, being subscribed 40.66 times. The highest demand came from Qualified Institutional Buyers (QIBs), who subscribed 81.83 times, followed by non-institutional investors (NIIs) who subscribed 81.83 times, and retail investors at 9.12 times by the close of the issue.

Baazar Style Retail received mostly positive reviews from brokerages, including Geojit, Deven Choksey Research, and Swastika Investmart, for the public issue, which comprised a fresh issue of 3,804,627 shares and an offer for sale, with promoters and investors offloading 17,652,320 shares with a face value of Rs 5 each. READ MORE

In its RHP papers, Baazar Style Retail mentioned that it will utilise the net proceeds towards the prepayment or repayment of all or a portion of certain outstanding borrowings availed by the company and for general corporate purposes. The company, however, will not receive any proceeds from the Offer for Sale. The proceeds of the Offer for Sale will be received by the selling shareholders and will not form part of the net proceeds.

About Baazar Style Retail

Headquartered in Howrah, West Bengal, Baazar Style Retail is a multi-brand fashion hub with over 135 stores scattered throughout 9 Indian states. Catering to men, women, and children of all ages, this fashion empire offers an extensive range of stylish apparel along with a vast collection of general merchandise.