Vaibhav Jewellers, a jewellery retailer, had a lacklustre debut on the stock exchanges on October 3, as it listed at par with its issue price of Rs 215. Both the NSE and the BSE saw the stock opening at Rs 215.
This debut performance aligned with analysts’ expectations of a subdued start, as the company’s initial public offering (IPO) had garnered limited interest from investors, despite its strong financial performance.
During its IPO, Vaibhav Jewellers achieved a subscription rate of 2.25 times, with the high-net-worth individuals (HNI) quota being oversubscribed by 5.18 times. However, the response from qualified institutional buyers (QIBs) and retail investors remained modest, with subscription levels of 1.06 times and 1.66 times, respectively.
The jewellery retailer has demonstrated consistent revenue growth and a robust increase in its bottom line. Its net profit recorded an impressive compound annual growth rate (CAGR) of 85.81 percent from FY21 to FY23, reaching Rs 71.6 crore. Additionally, the company’s revenue witnessed an average growth rate of 18.92 percent, reaching Rs 2,027.34 crore during the same period.
Dhruv Mudaraddi, a research analyst at StoxBox, noted, “The Andhra Pradesh-based company also boasts of a 23 percent return on its equity in FY23, which is attractive compared to its already listed peers.”
Vaibhav Jewellers, known for its hyperlocal jewellery retail chain, currently operates 13 showrooms in the micro markets of Andhra Pradesh and Telangana. The company’s expansion plans include the opening of eight more stores to tap into tier-2 and 3 markets, a strategic move considering that rural markets accounted for 50-52 percent of the total jewellery market in FY23, according to Mudaraddi.
