Stellar Start: DOMS Industries lists at a 77% premium at Rs 1400 per share on the BSE

DOMS Industries, a stationery and art product company primarily involved in designing, developing, manufacturing, and selling a wide range of these products under the flagship brand “DOMS,” made its debut on the Indian stock market today.

Upon its debut on the BSE, the stock opened at Rs 1400 per share, reflecting an impressive 77.22% premium compared to the final issue price of Rs 80 per share. On the NSE, it debuted at the same price of Rs 1400 per share.

Presently, the stock is trading at Rs 1404.55 per share on the BSE, with intraday highs and lows of Rs 1416.50 and Rs 1371.35, respectively. The current market capitalisation of the company stands at Rs 8523.83 crore.

IPO Proceeds 

The net proceeds from the issue will be allocated to several objectives. Firstly, to partially finance the cost of establishing a new manufacturing facility aimed at expanding production capabilities for a wide range of writing instruments, watercolour pens, markers, and highlighters. Secondly, for general corporate purposes.

Company profile:

DOMS Industries Limited is a stationery and art product company primarily engaged in designing, developing, manufacturing, and selling a wide range of these products under the flagship brand, DOMS, along with other brands/sub-brands including C3, Amariz, and Fixyfix. The company was incorporated in 2006.

The company offers stationery and art materials to consumers, which are classified into seven categories, and they are scholastic stationery, scholastic art materials, paper stationery, kits and combos, office supplies, hobby and craft, and fine art products. The company has an exclusive tie-up with certain entities of the FILA Group for the distribution and marketing of their products in South Asia. It has a strong, global multi-channel distribution network in over 45 countries in the USA, Africa, Asia Pacific, Europe, and the Middle East. The company operates 13 manufacturing facilities in Umbergaon, Gujarat, and one manufacturing facility in Bari Brahma, Jammu and Kashmir.

Subscription details: 

On December 15, 2023, the final day of the IPO window, the IPO witnessed an impressive response, notably outperforming other recently listed IPOs, achieving a subscription rate of 99.34 times. The public issue garnered substantial interest, with the retail category oversubscribed by 73.38 times, the QIB category reaching a subscription rate of 122.16 times, and the NII category achieving a subscription rate of 70.06 times.

The company attracted Rs 537.75 crore from various anchor investors by allotting 68.06 lakh equity shares at Rs 790 per share. The complete lock-in period for these anchor investors ends on April 23, 2024.

The IPO price range was set between Rs 750 and Rs 790, with a face value of Rs 10 per share and a lot size of 18 shares. The total size of the company’s IPO was Rs 1200 crore, and the final share issue price was fixed at Rs 790 each.

Financial Performance:

Conclusion:

The key dilemma for investors lies in whether to hold onto their shares. Those who applied for the IPO solely intending to capitalise on listing gains have already gained an impressive 77% return over its final issue price on the listing day itself. Investors who applied for the IPO purely for listing gains may consider closing their positions.

Conversely, investors with a higher risk tolerance might opt to hold onto their shares for the medium to long term, as this strategy could potentially yield benefits over time.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.