Allied Blenders: Invest in the IPO of this liquor manufacturing company? Brokerage gave Avoid rating

Allied Blenders IPO Open : Allied Blenders & Distillers IPO, a company that manufactures whiskey, brandy, gin, rum, vodka under many popular brand names including Officers ChoiceIt has opened today on 25 June 2024. One can invest in this IPO till 27 June. The size of the IPO is Rs 1500 crore. At the same time, the company has fixed the price band for this from Rs 267 to Rs 281 per share. It has opened for anchor investors on 24 June. This IPO will be listed in the market on 2 July. Experts have advised to stay away from this issue.

Nifty 100: 40% large cap stocks became multibaggers in 3 years, but these stocks fared badly

Advice to stay away from IPO (Avoid Allied Blenders IPO)

Shivani Nyati, Head of Wealth, Swastika Investmart has given an Avoid rating, advising to stay away from the Allied Blenders & Distillers IPO. She says that Allied Blenders & Distillers has a strong brand presence. The company has a diversified product portfolio and an all-India distribution network. However, its suitability for investment needs to be carefully considered. The company’s financial performance has been unstable, including low profit margins and high debt levels. In addition, the Indian Made Foreign Liquor (IMFL) industry is facing increasing competition, potential tax hikes and a highly regulated environment. At the same time, the valuation of the current IPO looks exceptionally high with a P/E of 4014x. Therefore, given the risk and high valuation, she has advised to avoid the Allied Blenders & Distillers IPO.

Old became gold: Earned 5 crores from SIP of Rs 5000, amazing 31 year old Tata Group scheme

What are the strengths of the company

One of the largest IMFL companies in India with a diversified and contemporary product portfolio.

Strong brand identity.

Access to a wide pan India distribution network with the ability to scale.

The Indian IMFL industry is well positioned to weather the headwinds.

Supported by an experienced Board and Senior Management team and a committed employee base.

You can get a profit of Rs 19000 in 4 weeks by investing 1 lakh, these 4 stocks are ready to show their strength

Risks and concerns with the company

The company has experienced volatile fluctuations in PAT and PAT margin for the last year/period.

Increasing competition in the IMFL industry.

Increase in taxes or changes in tax calculation methods may impact demand for products and adversely affect business.

The company’s operations are subject to extensive central and state regulations.

The company has some contingent liabilities.

(Source: Swastika Investmart)

On retirement, you need 1.5 crore fund and more than 1 lakh pension, how much investment will be required in pension scheme NPS

About IPO

Fresh equity shares worth Rs 1000 crore will be issued in the IPO, while there will be an offer for sale of Rs 500 crore. 35 percent of the IPO is reserved for retail investors. While 50 percent quota is reserved for qualified institutional buyers and 15 percent is reserved for non-institutional investors.

ICICI Securities Limited, Nuvama Wealth Management Limited and ITI Capital Limited are the book running lead managers for the Allied Blenders IPO, while Link Intime India Private Limited is acting as the registrar. According to the company’s RHP, it is India’s largest Indian Made Foreign Liquor or IMFL manufacturer.

Allied Blenders GMP

There is a craze in the grey market regarding the IPO of Allied Blenders. The unlisted stock of the company is trading at a premium of Rs 80 in the grey market. This premium is 28 per cent in terms of the upper price band of Rs 281. That is, compared to the issue price of Rs 281, the stock can be listed at Rs 361.