The Magenta Lifecare IPO opened for subscription on June 5 and will close on June 7. Priced at ₹35 per share, investors can bid for a minimum of 4,000 shares or multiples thereof. The IPO garnered significant interest from investors and was fully subscribed within hours of its launch. Retail investors need to invest a minimum of ₹1.4 lakh, while High Net-worth Individuals (HNIs) must apply for two lots of 8,000 shares, requiring a minimum investment of ₹2.8 lakh.
Magenta Lifecare Limited manufactures foam-based products like mattresses and pillows under the brand name “Magenta”. Their product range includes various types of mattresses and pillows.
Financial Performance
During fiscal years ending March 31, 2023 and March 31, 2022, the company’s revenue increased by 1.79%, and profit after tax (PAT) rose by 29.96%.
As of day 2, the subscription status of Magenta Lifecare IPO stands at 74.99 times. Retail investors subscribed 117.73 times, while the NII portion was booked 32.19 times. The QIBs portion was subscribed to 1%.
The IPO consists of a fresh issuance of 2,000,000 equity shares valued at about ₹7 crore, with no offer-for-sale component. The net proceeds will be utilized for financing working capital requirements and general corporate purposes.
Fedex Securities Pvt Ltd is the book running lead manager, and Cameo Corporate Services Limited is the registrar for the IPO. Sunflower Broking is the market maker.
The grey market premium for Magenta Lifecare IPO is +28, indicating a premium of ₹28 in the grey market. Based on this, the expected listing price for Magenta Lifecare shares is ₹63 per share, which is 80% higher than the IPO price of ₹35.
According to Dilip Davda, the contributing editor at Chittorgarh, the company operates in a competitive segment but aims to maintain and improve its performance with an asset light model and cost management. However, the issue appears aggressively priced based on FY24 annualized earnings.
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