Allied Blenders and Distillers IPO opens today: Should you subscribe to the issue
Allied Blenders and Distillers is an Indian-made foreign liquor company, offering five Indian-made foreign liquor categories- whisky, brandy, rum, vodka and gin.
- Jun 25, 2024,
- Updated Jun 25, 2024 10:53 AM IST
The initial public offering (IPO) of Allied Blenders and Distillers opens for bidding on Tuesday, June 25 and can be subscribed till Thursday, June 27. The company is offering its shares in the fixed price band of Rs 267-281 apiece. Investors can apply for a minimum of 53 equity shares and its multiples thereafter. Allied Blenders is the largest Indian-owned Indian-made foreign liquor company and the third largest IMFL company in India, in terms of annual sales volumes between FY14 and FY22. They entered the premium and semi-premium whisky segments and going forward they intend to continue to introduce products in the premium, semi-premium and deluxe segments, said Sushil Finance.
"More than 90 per cent of the revenue comes from whisky products. There are some established players in the market thus making the environment competitive. Any changes in the government policies, regulatory reforms in regard to alcohol markets may affect the operations of the company," it added with a 'neutral' view on the issue citing risks and rich valuations.
Prabhudas Lilladher Rating: Subscribe The IPO has been valued below leading IMFL players, which is rightly so on EV/Ebitda, given the higher mass volumes in ABD. Also, if we adjust the PAT based on the debt repayment from the IPO proceedings, the PE ratio falls to 56-59 levels. The company is planning to focus on the premium segment which will lead to margin expansion, said Prabhudas Lilladher.
"As per the management, the company can also take a JV route to develop its premiumisation journey with International players. Given the expected long growth runway for liquor players, dominance of whiskey in liquor segment, limited pan-India players in the segment and growing premiumization play in the economy, we assign 'subscribe' rating to the IPO," it said.
Disclaimer: Business Today provides stock market news for informational purposes only and should not be construed as investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.
The initial public offering (IPO) of Allied Blenders and Distillers opens for bidding on Tuesday, June 25 and can be subscribed till Thursday, June 27. The company is offering its shares in the fixed price band of Rs 267-281 apiece. Investors can apply for a minimum of 53 equity shares and its multiples thereafter. Allied Blenders is the largest Indian-owned Indian-made foreign liquor company and the third largest IMFL company in India, in terms of annual sales volumes between FY14 and FY22. They entered the premium and semi-premium whisky segments and going forward they intend to continue to introduce products in the premium, semi-premium and deluxe segments, said Sushil Finance.
"More than 90 per cent of the revenue comes from whisky products. There are some established players in the market thus making the environment competitive. Any changes in the government policies, regulatory reforms in regard to alcohol markets may affect the operations of the company," it added with a 'neutral' view on the issue citing risks and rich valuations.
Prabhudas Lilladher Rating: Subscribe The IPO has been valued below leading IMFL players, which is rightly so on EV/Ebitda, given the higher mass volumes in ABD. Also, if we adjust the PAT based on the debt repayment from the IPO proceedings, the PE ratio falls to 56-59 levels. The company is planning to focus on the premium segment which will lead to margin expansion, said Prabhudas Lilladher.
"As per the management, the company can also take a JV route to develop its premiumisation journey with International players. Given the expected long growth runway for liquor players, dominance of whiskey in liquor segment, limited pan-India players in the segment and growing premiumization play in the economy, we assign 'subscribe' rating to the IPO," it said.
Disclaimer: Business Today provides stock market news for informational purposes only and should not be construed as investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.