Adani Wilmar IPO: Should you subscribe as issue opens today? GMP, key details here
Premium- Adani Wilmar IPO, which comprises of fresh issue of equity shares, will conclude on January 21, 2022
Edible oil major Adani Wilmar's (AWL) public issue, comprising fresh equity shares, will open for subscription today and conclude on January 31. The price band of the three day share sale is fixed at ₹218-230 per share. On Tuesday, Adani Wilmar Ltd had raised ₹940 crore from anchor investors ahead of its initial public offering (IPO).
The public issue of Adani Wilmar comprises fresh issue of equity shares and there will not be any secondary offering.
As per market observers, Adani Wilmar shares premium (GMP) has remained steady at ₹45 in the grey market. The company's shares are expected to list on stock exchanges BSE and NSE on February 8, 2022.
"AWL aspires to become leading packaged food and FMCG company in India and it gets significant benefit from its parent ‘Adani Group’ and JV partner ‘Wilmar International’. We believe AWL is in sweet spot to take advantage of the prevailing opportunities and can grow multifold. Hence, we recommend to 'subscribe for long term gains’," said KR Choksey in a note.
Adani Wilmar sells cooking oils under the ‘Fortune’ brand. Apart from cooking oils, it sells food products like rice, wheat flour, and sugar. It also sells non-food products like soap, handwash, and sanitisers.
“Adani Wilmar has strong brand recall, wide distribution, better financial track record and healthy ROE. Considering all the positive factors, we believe this valuation is at reasonable levels. Thus, we recommend a subscribe rating on the issue," said Angel One in a note. Though, volatility in raw material prices and increase in competition could impact the profitability of the company, the brokerage added.
The proceeds of the public issue will be used to fund capital expenditure, reduce debt and for acquisitions as the company seeks to become India's biggest food and FMCG company.
On the financial front, Adani Wilmar Ltd's profit grew to ₹357 crore from ₹288.7 crore for the six months ended September in the current fiscal year whereas revenue increased to ₹24,957 crore as against ₹16,273 crore in the corresponding period of the previous year.
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A successful IPO will make Adani Wilmar the seventh Adani group company to list on the Indian stock exchanges.
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