Flair Writing IPO: Latest GMP, Day 2 Subscription Status, Review, More Details. Apply or not?

Flair Writing Industries IPO: Flair Writing Industries’ IPO opened for subscription on Wednesday, November 22nd and closes on Friday, November 24th. The price range for Flair Writing Industries Limited IPO has been set in the range of ₹288 tons ₹304 per share with a par value of ₹5. The lot size of the Flair IPO is 49 shares and thereafter a multiple of 49 shares.

Flair is a company that designs and manufactures writing instruments specifically designed for today’s ever-evolving market.

Investors responded positively to Flair’s IPO on day one and the issue was fully subscribed. The subscription status for Flair Writing’s IPO was 2.18 times on the first day. The public issue was subscribed 2.87 times in the retail category and 53% in the qualified institutional buyers (QIB) category. The share of non-institutional investors (NII) was recorded 2.78 times.

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The IPO of Flair Writing Industries Limited has reserved not less than 50% of the shares of the public issue for Qualified Institutional Buyers (QIB), not less than 15% for Non-Institutional Investors (NII) and not less than 35% of the offering is reserved for retail investors .

Also Read: Flair Writing IPO Day 1: Issue Subscribed 2.18 Times; Retail share booked more than twice

Flair IPO subscription status on day 2

Flair Writing’s IPO subscription status is 2.69x on the second day so far. Flair IPO’s retail share was subscribed 3.54 times, NII’s share was subscribed 3.58 times and qualified institutional buyers (QIB) share was 53% at 10:39 IST, as per the on BSE data available.

Flair Writing Industries Limited IPO details

Flair Writing’s IPO includes a new issue of shares valued at up to ₹292 crore and an Offer for Sale (OFS) of shares of face value ₹2 each from a promoter and others joining forces ₹301 crore. Flair Writing IPO size is ₹593 crore.

The following uses of the net proceeds of the new issue include establishment of New Valsad Unit, a new manufacturing facility for writing instruments in Valsad district of Gujarat; Funding the working capital requirements of the Company and its subsidiaries, Flair Writing Equipments Private Limited (FWEPL); Financing capital expenditure for the Company and its subsidiaries FWEPL and Flair Cyrosil Industries Private Limited (FCIPL); Financing the full or partial repayment or early repayment of certain loans taken by the Company and its subsidiaries FWEPL and FCIPL; and serve general corporate purposes.

Also Read: Flair Writing IPO: 10 Things RHP Should Know Before You Consider Applying

The promoters of the company are Rajesh Khubilal Rathod, Mohit Khubilal Rathod, Sumit Rathod, Vimalchand Jugraj Rathod and Khubilal Jugraj Rathod.

The book-running lead managers of the Flair Writing IPO are Nuvama Wealth Management Limited and Axis Capital Limited and the registrar of the issue is Link Intime India Private Ltd.

Flair Writing Industries Limited IPO GMP today

Flair Writing IPO GMP today or gray market premium is +71, meaning stocks are trading at their premium of ₹71 on the gray market, according to investorgain.com

Also Read: Flair Writing IPO opens today: GMP, issue details, price range, 10 important things to know before investing

Taking into account the upper end of the IPO price range and the current premium in the gray market, the estimated listing price of Flair Writing Industries Limited stock has been provided ₹375 per piece, which is 23.36% higher than the IPO price of ₹304.

“Gray market premium” indicates investors’ willingness to pay more than the issue price.

Also Read: Flair Writing IPO: Check out the top 10 risks investors should consider before investing

Evaluating Flair’s IPO

Anand Rathi Research

With consistent sales growth, a wide product range and a significant global presence, Flair Writing Instruments is among the top three companies in the Indian writing instruments market, according to the brokerage firm. The company has been on the market for more than 45 years and its flagship brand “Flair” is a symbol of stability. It also has the largest distribution network in the country. In addition, the company has increased its business efficiency with its current products, which has resulted in promising future prospects.

“At the high end, the company is valued at a P/E ratio of 27.1x and a market capitalization of ₹3,204 Crore after issue of shares and a return on net assets of 31.1%. As far as valuation goes, we believe the company is fairly priced. We therefore recommend a “Subscribe – Long Term” rating for the IPO, according to the broker.

Also Read: Tata Tech, Flair Writing, Fedbank Financial, Gandhar Oil Refinery, IREDA IPO: Check out this FAQ before investing

According to the broker, Flair Writing Industries Ltd. has a market share of 9% (as of March 2023) and is one of the three largest companies in the writing instruments sector. In addition, they export 25% of their goods worldwide. As of March 2023, CRISIL estimates that their market share in the writing and creative equipment export market was 7.1%. With 45 years in existence, “Flair” is the flagship brand name.

“Sales and PAT increased at a CAGR of 14% and 15% respectively for FY 2017-23. The company registered a faster growth of 14% CAGR as compared to industry growth of 5.5% in FY 2017-23. This edition is available at a price-to-earnings ratio of 24x for fiscal 2023, which seems fair compared to peers. Therefore, we recommend subscribing to the issue to capture listing gains and long-term gains,” the brokerage firm said.

Nirmal Bang

With a revenue growth of 14% CAGR between FY17 and FY23 (industry growth at 5.5%), the brokerage firm claims that the company has outperformed the industry. As the industry leader with the highest operating margin (19.5%), Flair delivered strong performance in FY23.

“Furthermore, ROE and ROCE stood at 27.1% and 30.5% respectively in FY23, which is significantly higher than peers’ performance. The issue is valued at 27 times FY23 EPS, which is a discount to peers. Therefore, we recommend SUBSCRIBE to the issue,” the brokerage firm said.

Disclaimer: The above views and recommendations are those of individual analysts, experts and brokerage firms, not Mint. We recommend investors consult certified experts before making an investment decision.

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