Stellar listing: Cello World debuts at a 28% premium at Rs 831 each on the BSE

Cello World Limited is a well-known Indian company that specialises in three key product categories: writing instruments and stationery, moulded furniture, and consumer housewares, along with related products, debuted on the Indian stock market today.

Upon its debut on the BSE, the stock opened at Rs 831 per share, reflecting a 28% premium in comparison to the issue price. Conversely, on the NSE, the stock commenced trading at Rs 829 per share, signifying a 27.9% increase over its initial public offering price of Rs 648 per share.

As of the current moment, the stock is being traded at Rs 782 per share on the BSE, having reached intraday highs and lows of Rs 834.70 and Rs 781.50, respectively. The present market capitalisation of the company stands at Rs 16,596 crore.

The book-running lead managers for the IPO are Kotak Mahindra Capital Company Limited, ICICI Securities Limited, IIFL Securities, JM Financial, and Motilal Oswal Investment Advisors Limited. Additionally, Link Intime India Private Limited serves as the registrar for the issue.

IPO Proceeds: 

The company will not receive any proceeds from the Offer as this IPO does not involve any fresh issue of shares, it solely comprises an offer for sale.

Company profile:

Cello World Limited is a renowned Indian company specializing in three primary product categories: writing instruments and stationery, moulded furniture, and consumer housewares, along with associated items. With over six decades of experience in the consumer product industry, the company possesses a deep understanding of consumer preferences and choices.

Cello World boasts 13 manufacturing facilities spread across five distinct locations in India. Additionally, the company has plans to establish a state-of-the-art glass manufacturing facility in Rajasthan, equipped with cutting-edge European machinery, designed to enhance productivity and increase manufacturing capacity.

Subscription details: 

On November 01, 2023, the final day of the IPO window, the IPO witnessed an impressive response with a subscription rate of 41.69 times. The public issue received mixed interest, as the retail category was subscribed 3.21 times, the QIB category achieved a subscription rate of 122.20 times, and the NII category reached a subscription rate of 25.65 times.

The company attracted Rs 567 crore from various anchor investors by allocating 87.49 lakh equity shares at Rs 648 per share. The complete lock-in period for these anchor investors ends on March 14, 2024.

The IPO price range was set between Rs 617 and Rs 648, with a face value of Rs 5 per share and a lot size of 23 shares. The total size of the company’s IPO was Rs 1,900 crore, and the final share issue price was fixed at Rs 648 each.

Financial Performance: 

Conclusion: 

The key dilemma that investors face is whether to retain their shares. Those who applied for the IPO with the sole intention of capitalising on listing gains have already reaped significant returns, witnessing an impressive 28% increase on the very first day as the stocks debuted at a premium of Rs 831 per share on the BSE. As a result, these investors may consider closing their positions.

Conversely, investors with a higher risk tolerance might opt to hold onto their shares for the medium to long term, as this strategy could potentially yield benefits over time.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.