Wakefit Innovations will make its market debut on Monday after its Rs 1,289-crore public issue was subscribed 2.52 times during the December 8–10 bidding window.
The home and furnishings company had raised Rs 580 crore from anchor investors ahead of the issue.
Analysts said investors may consider booking profits if the stock lists with gains.
Wakefit, known for its direct-to-consumer presence in the home and sleep solutions segment, sells mattresses and has been expanding into furniture and home décor through online channels and a growing offline network.
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Mahesh M Ojha, VP – Research & Business Development at Kantilal Chhaganlal Securities, said the IPO valuation had been "rerated" on metrics such as price-to-sales, which were higher than some peers. "The view remains neutral; monitor after listing. Profits can be booked if there are any listing gains," he said.
Ojha added that compared with larger players like Sheela Foam, Wakefit is still early in its profitability cycle and continues to report negative earnings on a full-year basis.
Listing gains, if any, are expected to be limited due to moderate demand across investor categories, said Prashanth Tapse, Research Analyst at Mehta Equities Ltd.
"Since our IPO call was for risk-oriented investors, we maintain our stance. Allotted investors may hold with a long-term view," he said.
Tapse added that non-allotted investors need not chase the stock on the first day and could wait for more reasonable entry levels, as near-term price weakness cannot be ruled out.
According to the company, Rs 31 crore from the fresh issue will go towards setting up 117 new COCO-Regular stores, Rs 15.4 crore for new equipment and machinery, and Rs 161.4 crore for lease and licence payments for existing stores.
A further Rs 108.4 crore has been earmarked for marketing and advertising to boost brand visibility, with the balance set aside for general corporate purposes.
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