| Price | Lot Size | Issue Date | Issue Size |
|---|---|---|---|
| ₹ 74 to ₹ 78 | 190 | 11th Dec, 2024 – 13th Dec, 2024 | ₹ 8,000.00 Cr |
About Vishal Mega Mart Ltd IPO
Incorporated in 2001, Vishal Mega Mart Limited (VMML) is a leading hypermarket chain in India, offering a diverse range of products such as apparel, groceries, electronics, and home essentials. The company caters to middle and lower-middle-income consumers by providing both its own brands and third-party brands across apparel, general merchandise, and fast-moving consumer goods (FMCG). The product portfolio includes clothing, home furnishings, travel accessories, kitchen appliances, food, non-food items, and staples. VMML operates a pan-India network of 645 stores as of September 30, 2024, spread across 414 cities in 28 states and two union territories. In addition to its physical stores, the company also offers an omni channel shopping experience through its mobile app and website. The company follows an asset-light business model, leasing all its stores and distribution centres. The products are manufactured by third-party vendors or sourced from third-party brands. By September 2024, its local delivery service, available in 600 stores across 391 cities, had 6.77 million registered users. Vishal Mega Mart ranks among India’s top two offline-first diversified retailers and employs over 16,500 people. Its portfolio of own brands includes Classics, Fashion, Denim, Ethnic (apparel); Tandem, Home Select, Home Finery (general merchandise); and savory products, staples, home care (FMCG).
Objective of the Vishal Mega Mart Ltd IPO
The company will not receive any proceeds of the Offer for Sale from the Promoter Selling Shareholder. The Promoter Selling Shareholder will be entitled to the entirety of the proceeds of the Offer for Sale after deducting its portion of the offer-related expenses and the relevant taxes thereon.
Rationale To Invest In Vishal Mega Mart Ltd IPO
Caters to India’s growing population with a customer-centric approach, driving loyalty and growth
Vishal Mega Mart is serving India’s growing population with its robust pan-India presence, strategically positioned across 645 stores in 414 cities. This widespread footprint ensures accessibility to a diverse and expanding consumer base, particularly in Tier 2 and beyond, where retail opportunities are surging. The company’s proven track record of successful store growth – opening 35 new stores in the first half of FY24 – highlights its effective expansion strategy, which focuses on key factors such as population density, consumer proximity, and accessibility. At the core of its success is a consumer-centric approach, offering a wide range of affordable, high-quality products across apparel, FMCG, and general merchandise. This focus on meeting the needs of middle and lower-middle-income segments has fostered strong customer loyalty. Additionally, initiatives such as the loyalty program and hyper-local delivery services ensure that Vishal Mega Mart provides a seamless shopping experience, further enhancing customer retention. This strong customer loyalty fuels the company’s financial performance, resulting in consistent revenue growth and a competitive edge in the market. With efficient store operations, quick payback periods, and a strong digital presence, Vishal Mega Mart is well-positioned for continued financial success, ensuring sustained growth in India’s dynamic retail landscape.
Evolving portfolio of own brands across key product categories improving performance
Vishal Mega Mart has established a strong and diverse portfolio of own brands across key product categories, including apparel, general merchandise, and fast-moving consumer goods (FMCG). The company offers a wide range of products, such as apparel for men, women, and children, along with household items, home furnishings, and essential FMCG products. In FY24, 19 of its own brands recorded sales exceeding Rs. 1,000 million each, with six surpassing Rs. 5,000 million. Own brands contributed over 70% of its total revenue, highlighting the growing consumer preference for Vishal Mega Mart’s offerings. The company continues to expand its brand portfolio and has introduced new products under its “Tandem” brand for home appliances and “First Crop” brand for FMCG, which has led to strong revenue growth of 27.7% CAGR from FY22 to FY24. Vishal Mega Mart’s competitive advantage also lies in its efficient supply chain and vendor relationships. By maintaining stringent quality control and consistency across all products, the company ensures high standards in every stage of production. With its expansive product range, strong brand presence, and focus on quality, Vishal Mega Mart is well-positioned for continued growth and sustained leadership in India’s retail market.
Valuation of Vishal Mega Mart Ltd IPO
India’s retail market, valued at Rs. 68-72 lakh crores in 2023, is experiencing rapid growth, driven by increasing consumer aspirations, urbanization, and significant expansion in Tier-2 cities. Vishal Mega Mart is strategically positioned to capitalize on this growth, offering a wide range of affordable products across apparel, FMCG, and general merchandise. With 645 stores in 414 cities, the company caters to middle and lower-middle-income consumers, generating over 70% of its revenue from its own brands. Vishal Mega Mart is expanding its pan-India store network, focusing on Tier-2 and Tier-3 cities while driving same-store sales growth through a diversified product portfolio, improved in-store experiences, and leveraging technology and consumer data. The company’s financial performance reflects strong growth, with revenue from operations increasing at a CAGR of 26.3%, reaching Rs. 89,119.5 million in FY24 from Rs. 55,885.2 million in FY22. EBITDA grew to Rs. 12,486.0 million in FY24 from Rs. 8,036.9 million in FY22, with consistent margins. Profit for FY24 stood at Rs. 4,619.4 million. The current issue is priced at a P/E of 77.2x on the upper band, which is lower than its peers. Despite risks related to vendor dependencies, legal challenges, and evolving consumer preferences, the company’s cost-efficient measures, consumer-centric approach, and growth strategy make it an attractive investment opportunity in India’s evolving retail landscape. Therefore, we recommend a “SUBSCRIBE” rating for the issue, with a medium- to long-term investment horizon.
What is the Vishal Mega Mart Ltd IPO?
Vishal Mega Mart IPO is a book built issue of Rs 8,000.00 crores. The issue is entirely an offer for sale of 102.56 crore shares. Login to your account now.
How to apply for the Vishal Mega Mart Ltd IPO through StoxBox?
To apply for the Vishal Mega Mart Ltd IPO through StoxBox one can apply from the website and also from the app. Click here
When will the Vishal Mega Mart Ltd IPO open?
Vishal Mega Mart Ltd IPO is opening on 11th December 2024. Apply Now
What is the lot size of the Vishal Mega Mart Ltd IPO?
The Lot Size of Vishal Mega Mart Ltd IPO is 190 equity shares. Login to your account now
When is the Vishal Mega Mart Ltd IPO allotment date?
The allotment Date for Vishal Mega Mart Ltd IPO is 16th December 2024. Login to your account now.
When is the Vishal Mega Mart Ltd IPO listing date?
The listing Date for Vishal Mega Mart Ltd IPO is 18th December 2024. Login to your account now
What is the minimum investment required for the Vishal Mega Mart Ltd IPO?
In the Retail segment the minimum investment required is Rs. 14,820. Login to your account now
What is the maximum investment allowed for the Vishal Mega Mart Ltd IPO?
In the Retail segment the maximum investment requirement is Rs. 192,660. Login to your account now
What are the risks associated with investing in the Vishal Mega Mart Ltd IPO?
- The company relies on third-party vendors to manufacture its products, exposing it to risks such as supply chain disruptions, raw material cost fluctuations, and quality issues. While past disruptions have been managed, future challenges could impact operations, profit margins, and financial performance, as the company does not have long-term agreements.
- The company is involved in ongoing legal proceedings, including Rs. 70.54 million in civil litigations and Rs. 398.57 million against subsidiaries like Air Plaza Retail Holding Private Limited. It faces regulatory notices, including from MCA and the Enforcement Directorate (ED), regarding violations of the FEMA and tax laws. Unfavourable outcomes may impact its financial condition, reputation, and stock price.
- The company operates in a market with rapidly changing consumer preferences, including trends, fashion, and quality. Failure to anticipate or respond to these shifts in a timely manner may lead to decreased demand for its products. The inability to adapt could negatively impact its market share and consumer loyalty and ultimately affect its business, financial condition, and cash flows.
When will the Vishal Mega Mart Ltd IPO shares be credited to my Demat account?
The Vishal Mega Mart Ltd IPO be credited to the account on allotment date which is 17th December 2024. Login to your account now
Where can I find the Vishal Mega Mart Ltd IPO prospectus?
The prospectus of Vishal Mega Mart Ltd IPO prospectus can be find on the website of SEBI, NSE and BSE
What are the important dates related to Vishal Mega Mart Ltd IPO?
| IPO Open Date | Wednesday, December 11, 2024 |
| IPO Close Date | Friday, December 13, 2024 |
| Basis of Allotment | Monday, December 16, 2024 |
| Initiation of Refunds | Tuesday, December 17, 2024 |
| Credit of Shares to Demat | Tuesday, December 17, 2024 |
| Listing Date | Wednesday, December 18, 2024 |
| Cut-off time for UPI mandate confirmation | 5 PM on December 13, 2024 |
