Cello World IPO opens: Check GMP signal, subscription status, reviews

The Cello World initial public offering (IPO) has opened today and will end on November 1, 2023. The Mumbai-based consumer ware company aims to raise ₹1,900 crore via public issue. The IPO offer includes a reservation of up to ₹10 crore for subscription by eligible employees. The OFS will see promoter Pradeep Ghisulal Rathod paring shares worth ₹300 crore, ₹736 crore by Pankaj Ghisulal Rathod, ₹464 crore by Gaurav Pradeep Rathod, ₹200 crore by Sangeeta Pradeep Rathod, and ₹100 crore by both Babita Pankaj Rathod and Ruchi Gaurav Rathod.

Grey market premium & IPO subscription so far:

In the grey market, investors are showing enthusiasm for Cello World Ltd shares, as the scrips are available at a premium of ₹90 today.

In terms of subscription, the Cello World IPO has been subscribed 0.18 times, with the company receiving bids for 40,56,832 shares of the total 2,20,61,947 shares on offer. The quota for non-institutional investors has been subscribed 0.36 times, while the retail quota has been subscribed 0.22 times and the employees category 0.25 times. The qualified institutional buyers (QIBs) have placed bids for 9,016 shares of the total 65,66,045 on offer, making it the least subscribed category so far.

What market research firms say:

Reliance Securities: Subscribe

Reliance Securities has given a 'subscribe' call to the Cell World IPO, saying the company showed its manufacturing and production capabilities with continuous innovation. "We believe CWL would be a prominent player in its respective business verticals with a large addressable market growth of average 16%, strong financials, debt free company offers a growth play in the long term. Therefore we recommend a SUBSCRIBE to the issue."

Choice India: Subscribe with caution

Market research firm Choice India has advised "subscribe with caution" with regards to the IPO, citing highly-priced issue. "At higher price band, CWL is demanding a TTM P/E multiple of 48.8x (to its TTM earning per share of Rs. 13.3), which is at significant premium to the peer average of 38.6x. Thus the issue is overvalued…due to highly priced issue, we are assigning a “Subscribe with Caution” rating for the issue," says Choice India.

Mehta Equities: Subscribe with Long Term

Mehta Equities has recommended "Subscribe with Long Term" to the issue, saying gives investors an opportunity to invest in a renowned Indian consumer product company with 60+ years of experience. "By looking at the financials historically, Cello World has delivered a healthy growth in revenue from operation of 29.51%/32.19% in FY 2022/23 and healthy profit after tax growth of 32.6% in FY 2022 and 29.9% in FY 2023. We recommend investors to "SUBSCRIBE” to the Cello World Ltd IPO offer with long-term perspective."

About Cello World IPO

The Cello World IPO offer is being made via the book-building process, wherein not more than 50% of the offer will be available for allocation on a proportionate basis to qualified institutional buyers, not less than 15% of the offer will be available for allocation to non-institutional bidders and not less than 35% of the offer will be available for allocation to retail individual bidders.

The company boasts an extensive product portfolio across three key categories: consumer houseware, writing instruments and stationery, and moulded furniture and related products. During the Financial Years 2021, 2022 and 2023, Cello claims to have launched 397, 169 and 380 new products across its three product categories, respectively.

Cello World Financials

For the fiscal year 2023, Cell’s consolidated revenue increased 32.19% to ₹1,796.69 crore against ₹1,359.18 crore a year ago. Net profit increased by 29.86% from ₹219.52 crore in fiscal 2022 to ₹285 crore in fiscal 2023. “It had the highest ROCE amongst the peers in FY 2021 and FY 2023 and highest EBITDA Margin for fiscal 2021, 2022 and 2023,” claims Cello.

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