Vitrified tiles manufacturer Exxaro Tiles initial public offering continues to garner strong demand from investors as the issue was subscribed 22.67 times on August 6, the final day of bidding.
The subscription data available on exchanges showed that the offer has received bids for 25.96 crore equity shares against IPO size of 1.14 crore equity shares, garnering bids worth Rs 3,115.2 crore. It is a small IPO in size amongst others - Devyani International, Windlas Biotech and Krsnaa Diagnostics that are closing for subscription today.
The portion set aside for qualified institutional buyers was subscribed 17.67 times and that of non-institutional investors had seen a 5.36 times subscription.
Retail investors remained at the forefront in bidding as their portion was subscribed 40.10 times, while employees saw subscription of 2.53 times.
Exxaro Tiles, engaged in the manufacturing and marketing of vitrified tiles with market share of less than 1 percent, is planning to raise Rs 161.08 crore through its public issue at higher end of price band of Rs 118-120 per share.
The company operates in a highly competitive field with fragmented players. The company has presence across premium products such as double charge tiles and glazed vitrified tiles of the ceramic industry. Its Retail and institutional sales volume mix 85 percent and 15 percent respectively in FY21.
Also read - Exxaro Tiles IPO: 10 things to know about the issue and the company
"Exxaro Tiles' profitability margin is better than its other peers in the industry. Its debt-to-equity (D/E) stood at 1.12x in FY2021 and post issue, D/E would stand at around 0.87x. The company would trade at P/E of 26.43x for FY21 which is attractive as compared to its peer competitors," said Canara Bank Securities which recommended a subscribe' for listing gains.
Its product portfolio consists of 1000+ different designs of tiles in 6 sizes. Topaz Series, Galaxy Series, and High Gloss Series are some of the well-established products of the company.
Also read - Exxaro Tiles raises Rs 23.68 crore from anchor investors, ahead of IPO
Grey Market Premium
Exxaro Tiles shares were available at a premium of Rs 15-20 in the grey market, resulting into a trading price of Rs 135-140 per share, the IPO Watch and IPO Central data showed.
The trading premium in percentage terms comes to 12.5-16.7 percent over issue price of Rs 120 per share.
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