FirstCry IPO Subscription Status: The IPO (New IPO) of Brainbees Solutions, which runs an omni-channel kidswear business under the FirstCry brand, has received a weaker response than expected from investors. This IPO has been subscribed only 12 times till 4 pm on its third and last day. At the same time, its craze is continuously decreasing in the gray market and right now it is seen at only 5 percent premium. In such a situation, FirstCry’s stock is expected to have a weak listing. The company’s stock will be listed on BSE and NSE on August 13.
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Subscribed 12 times till now
In FirstCry’s IPO, 10 percent share is reserved for retail investors and it has been subscribed 2.18 times till 4 pm on the third day. 75 percent share is reserved for qualified institutional investors i.e. QIB and it has been subscribed 19.30 times till 4 pm on the third day. While 15 percent share is reserved for non-institutional investors i.e. NII and it has been subscribed 4.61 times till now. Quota has also been kept for the employees of the company, under which they have got a discount of Rs 44 per share. This share has been subscribed 6.36 times till now.
GMP drops to 5%
The premium in the grey market for FirstCry’s IPO is continuously decreasing. On the third day of the IPO, the company’s unlisted stock is trading at a premium of Rs 25. This premium is 5 per cent in terms of the upper price band of Rs 465.
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How does the company’s outlook look?
According to brokerage house Swastika Investmart, Brainbeez Solutions is India’s largest online retailer of baby and child care products, boasting strong brand recognition, customer royalties and engagement. Brainbeez has faced financial challenges, incurring losses despite revenue growth. Negative cash flow further underscores these concerns. The company operates in a highly competitive environment. In the absence of profitability, a meaningful P/E valuation cannot be determined.
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However, according to brokerage house SBI Securities, the company has turned Ebitda positive in FY 2024. It is well positioned to meet the $120 billion market size of child, mother and kids care products. Its store count has grown 50 per cent to 1063 in the last 2 years, the break-even of these stores is expected to contribute to profitability. India’s child care penetration is very low compared to global standards, which is a big opportunity for branded players like FirstCry.
(Disclaimer: Investing or selling stocks is advised by the brokerage house. These are not the personal views of Financial Express. There are risks in the market, so take expert advice before investing.)