![Allied Blenders and Distillers IPO shares to list on Tuesday. Here's what GMP indicates](https://img.etimg.com/thumb/msid-111409918,width-210,height-158,imgsize-90976,resizemode-75/allied-blenders-and-distillers-ipo-shares-to-list-on-tuesday-heres-what-gmp-indicates.jpg)
Considering the upper price band of 281, the stock is expected to fetch a listing gain of about 17% over the issue price.
However, it is important to note that grey market premiums are just an indicator as to how a company's shares are stacked up in the unlisted market and are subject to change rapidly.
The IPO, which was a combination of fresh equity sale of Rs 1,000 crore and an offer for sale (OFS) of 1.77 crore shares, was subscribed over 20 times at close.
The proceeds from the fresh issue will be used for prepayment or scheduled repayment of a portion of certain outstanding borrowings and balance for general corporate purposes.
With a market share of over 8% in India-made foreign liquor market by sales volumes in fiscal 2023, Allied Blenders and Distillers is engaged in the manufacturing, marketing and sale of alcoholic beverages in India and abroad. The product portfolio of the firm comprises several brands of IMFL across whisky, brandy, rum and vodka.
Over the years, the company has expanded and introduced products across various categories and segments, having successfully leveraged its strength in the popular segment to launch successful brands.
While Allied Blenders boasts of a strong brand presence, a diverse product portfolio, and an extensive panIndia distribution network, the company's financial performance has been volatile, characterised by low-profit margins and high debt levels, according to analysts.
"Additionally, the Indian Made Foreign Liquor (IMFL) industry faces intensifying competition, potential tax hikes, and a highly regulated environment," said Swastika Investmart.
For the nine months ended December 2023 period, the company clocked revenue growth of 9% year-on-year at Rs 5,915 crore. Meanwhile, the profit after tax in the same period increased 50% year-on-year to Rs 4.2 crore.
ICICI Securities, Nuvama Wealth Management, and ITI Capital acted as the book running lead managers to the issue.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
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