DOMS Industries IPO Opens Today: Latest Subscription Status, What GMP Signals For Listing

DOMS Industries, the second-largest player in India's branded stationery and art products market, has opened its initial public offering (IPO) for subscription today, December 13. The IPO, set to close on December 15, comes with a price band of Rs 750 to Rs 790 per equity share with a face value of Rs 10.

As of 11:36 IST on the first day of the IPO, DOMS Industries has garnered a subscription of 1.46 times. Notably, retail investors have shown robust interest, subscribing 5.72 times, while the Non-Institutional Investors (NII) portion is subscribed 1.43 times. Qualified Institutional Buyers (QIB) have shown a cautious interest, with the portion booked at 0.01%.

The total bids received amount to 1,28,34,126 shares against the 87,63,333 shares on offer, according to data from the BSE.

Ahead of the IPO opening, DOMS Industries commanded a healthy premium in the grey market. Unlisted shares were trading at a premium of Rs 450 a piece, indicating positive sentiment among investors. The grey market often serves as an unofficial barometer for the demand and expected listing price of IPOs.

Investors closely monitor the Grey Market Premium (GMP) to gauge potential listing prices. The strong premium indicates a positive outlook and heightened interest in the IPO.

The IPO comprises a fresh issue of shares, raising up to Rs 350 crore, and an Offer for Sale (OFS) of equity shares by promoters and others aggregating up to Rs 850 crore. Under the OFS, promoters Fabbrica Italiana Lapis, Sanjay Mansukhal Rajani, and Keta Mansukhal Rajani will offload shares, with proceeds going to the selling shareholders.

If the IPO is fully subscribed at the upper end of the price band, DOMS Industries aims to raise Rs 1,200 crore. The funds from the fresh issue will be utilized to establish a new manufacturing facility, expanding production capabilities for a wide range of writing instruments, watercolour pens, markers, and highlighters. Additionally, the funds will be used for general corporate purposes.

The IPO follows the book-building process, with 75% of the net offer reserved for Qualified Institutional Buyers (QIBs), 15% for Non-Institutional Investors (NIIs), and the remaining 10% for retail investors. A special reservation of up to Rs 5 crore worth of shares is allocated for employees of the company.

As of fiscal 2023, DOMS Industries holds a substantial market share of about 12% by value, making it the second-largest player in the Indian market for branded stationery and art products. The company reported a net profit of Rs 96 crore for the fiscal year ending March 2023, with revenue surging by an impressive 77% year-on-year to Rs 1,212 crore.

Notably, Earnings Before Interest, Tax, Depreciation, and Amortization (EBITDA) witnessed a growth of 149% year-on-year, reaching Rs 187 crore during the same period. The EBITDA margin expanded significantly to 15.4% in FY23 compared to 11% in FY22.

For the six-month period ending September FY24, DOMS Industries continued its strong performance, posting a net profit of Rs 71 crore on revenue of Rs 762 crore.

JM Financial, BNP Paribas, ICICI Securities, and IIFL Securities are the book-running lead managers overseeing the IPO process, ensuring a smooth transition for DOMS Industries into the public domain. Link Intime India has been appointed as the registrar for the IPO.

The equity shares of DOMS Industries are slated to be listed on the stock exchanges on December 20, marking a significant milestone for the stationery and art company.

With strong financials, a significant market presence, and a positive response from investors in the IPO, DOMS Industries appears poised for a successful entry into the public markets.