Decent market debut: Zappfresh-owner DSM Fresh Foods shares list at 20% premium over SME IPO price

DSM Fresh Foods IPO

The shares of DSM Fresh Foods, the company which operates meat delivery startup Zappfresh, were listed at Rs 120 apiece on the BSE SME platform on October 9. This marks a premium of 20 percent over the IPO price of Rs 100 apiece.

The listing premium has significantly beaten grey market estimates. Ahead of listing, the unlisted shares of the company were trading with zero grey market premium (GMP) over the IPO price at Rs 100 apiece, according to data on Investorgain.

About DSM Fresh Foods IPO:

DSM Fresh Foods had launched its IPO to raise over Rs 59 crore entirely through a fresh issue of shares at a price band of Rs 95-100 apiece. Investors could bid for a minimum of 1,200 shares, requiring an investment of Rs 1.20 lakh per lot, and in multiples thereafter.

DSM Fresh Foods IPO subscription:

The IPO saw decent investor interest during its three days of public bidding, being fully subscribed between September 26 and October 6. Non Institutional Investors (NII) showed the most interest, booking their reserved portion nearly 2 times. Qualified Institutional Buyers (QIB) followed, subscribing their reserved portion over 1.5 times. The portion kept for retail investors was nearly fully subscribed.

How will DSM Fresh Foods IPO proceeds be used?

Around Rs 25 crore from the IPO proceeds will be used for working capital requirements, Rs 15 crore for marketing expenditure, Rs 11 crore for capital expenditure requirements and Rs 3 crore towards inorganic growth opportunities through acquisitions and other strategic initiatives, as well as for general corporate purposes.

About DSM Fresh Foods:

Founded in 2015, DSM Fresh Food is one of the leading omnichannel retailers of fresh meat and ready-to-cook/eat products — chicken, mutton and seafood. Over the last two years, Zappfresh has accelerated its growth through acquisitions, including Bonsaro (Majestic Aliments India Pvt Ltd) in Mumbai and Dr. Meat (Sukos Foods Pvt Ltd) in Bengaluru.

Zappfresh competes with companies like Licious, FreshToHome, TenderCuts and Meatigo. Narnolia Financial Services was the book-running lead manager to the offer.

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