Honasa Consumer Limited, the parent company of Mamaearth, has scheduled its Initial Public Offering (IPO) listing under the 'B' Group of Securities on Indian exchanges for Tuesday. Trading is set to commence at 10:00 AM IST. The company's shares are currently trading at a premium of ₹31 in the grey market, suggesting high valuations.
Despite robust investor participation, including Qualified institutional bidders (QIB), market experts from Mehta Equities predict a flat listing. They anticipate a listing price between ₹314 and ₹344 per share and warn of potential sharp post-listing drops due to high valuations and inherent business risks.
Earlier this week, Honasa Consumer's Mamaearth IPO was priced at ₹324 per share. Amid a social media controversy over its valuation, shares were trading at a ₹30 premium in the grey market. Nonetheless, it was oversubscribed 7.61 times with active participation from retail and non-institutional investors on the final day. The ₹1,701-crore issue attracted bids for 22 crore shares against an offer of 2.9 crore shares.
The IPO consisted of a fresh issue of ₹365 crore (INR100 crore = approx. USD12 million) and an Offer-for-Sale of 4.125 crore shares by stakeholders. Employees were offered a ₹30 share discount and subscriptions were led by institutional buyers. Honasa Consumer secured ₹765.20 crore from domestic and international anchor investors. The proceeds will fund advertising initiatives to boost brand visibility, establish new exclusive outlets, invest in subsidiary BBlunt for new salons, and other corporate purposes.
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