D-Mart owner Avenue Supermarts sets IPO price band at Rs 295-299

Avenue Supermarts, the operator of supermarket retail chain D-Mart, has set a price band of Rs 295-299 for its upcoming Rs 1,870-crore initial public offering (IPO).

The issue will open on March 8 and close on March 10, 2017.

The bids can be made for a minimum of 50 equity shares and in multiples of 50 shares thereafter.

Avenue Supermarts has reserved 50 percent portion of public issue for qualified institutional buyers and out of which, 60 percent may be allocated to anchor investors.

The company said 15 percent portion of the total issue size is reserved for non-institutional investors and the rest 35 percent for retail investors.

Grey market brokers say that the issue is quoting at a premium of Rs 170-180 in the unofficial market.

In its draft prospectus, the company had said that a large chunk of the funds raised through the issue will be used to repay debt.

D-Mart operates close to 120 stories, most of them concentrated in Maharashtra and Gujarat.

As of March 31, 2016, the company had a topline of about Rs 8,600 crore, and a net profit of about Rs 320 crore, translating into an earnings per share of Rs 5.72.

Kotak Mahindra Capital Company is a global co-ordinator and book running lead manager to the issue. Other book running lead managers are Axis Capital, Edelweiss Financial Services, ICICI Securities, Inga Capital, JM Financial Institutional Securities, Motilal Oswal Investment Advisor and SBI Capital Markets.