Should you invest in the Sai Silks (Kalamandir) Limited IPO?
One of the top merchants of ethnic clothing in South India, Sai Silks (Kalamandir) Limited (Sai Silks) specializes in sarees. Through its first public offering (IPO), which is scheduled to open for subscription on September 20, 2023, and conclude on September 22, 2023, the firm hopes to raise 1,201 crores.
IPO
POSITIONAL CALLS
9/18/20232 min read
The following uses will be made of the IPO proceeds:
To pay for the growth of the business's physical retail network
to make investments in its omnichannel capabilities and e-commerce platform
To increase its base of working capital
Concerning the company
With its corporate headquarters in Hyderabad, Telangana, Sai Silks was established in 1975. In four South Indian states—Andhra Pradesh, Telangana, Karnataka, and Tamil Nadu—the firm has a network of approximately 54 outlets. Sarees, lehengas, kurtas, sherwanis, and children's ethnic wear are just a few of the items that Sai Silks provides in its extensive collection of ethnic wear for ladies, men, and kids.
A great reputation has been established for the business across South India because to the high quality of its products and the tender loving care with which it handles its customers. Sai Silks has been expanding its online shop in recent years as well.
Financial results
Sai Silks has consistently had favorable financial results in recent years. The company's revenue for FY23 increased from FY22's 1,023 crores to 1,251 crores. Its net profit for FY23 increased from FY22's 122 crores to 151 crores.
Valuation
The Sai Silks IPO's price range has not yet been disclosed. The issue is anticipated to be priced at a price-to-earnings (P/E) ratio of 20–25 times based on the company's FY23 results, nevertheless. This is consistent with the assessments of other listed Indian ethnic apparel stores.
Investing, what about it?
In South India, Sai Silks is a respected, successful company with a well-known brand. The success of the business' online shop may be partly blamed for the growth of the ethnic apparel market.
Investors must be made aware that a premium would likely be required for the IPO. The ethnic clothing market is likewise cyclical and influenced by a number of variables, including consumer attitudes, fashion trends, and the economy.
In general, investors with a lengthy investing horizon might consider the Sai Silks IPO. Investors should thoroughly assess the risks and rewards before investing in the IPO.
Disclaimer: Reading this blog does not constitute a recommendation to buy Sai Silks stock. A financial adviser should be consulted before any investing choices are made by investors.