Flair Writing Industries lists at 66% premium over IPO price

Both firms will also start a joint venture of Rs 250 crore where Delta Corp will be the major shareholder, the company said in a regulatory filing.

Following the footsteps of Tata Technologies and Gandhar Oil Refinery, Flair Writing Industries also impressed investors by listing on bourses at a premium of 66 percent over issue price.

The stock started trading at Rs 501 on the NSE and Rs 503 on the BSE, against issue price of Rs 304, buoyed by overall positive market mood as well as IPO over-subscription.

Being a leading player in the writing instruments and stationery segment, Flair Writing received higher-than-expected subscription demand, especially from QIB investors, who were more aggressive in bidding by 115.6 times.

Overall, the Rs 593-crore public issue was subscribed 46.68 times during November 22-24. High networth individuals bought 33.37 times the allotted quota and the portion set aside for retail investors was booked 13.01 times.

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The financials

Flair recorded profit growth at a CAGR of 993 percent and revenue grew at a CAGR of 78 percent during FY21-FY23, while EBITDA (earnings before interest, tax, depreciation and amortisation) increased at a CAGR of over 180 percent.

Flair Writing will be spending net fresh proceeds for setting up a new manufacturing facility for writing instruments in Valsad, Gujarat at a cost of Rs 95.6 crore. Further, Rs 86.75 crore will be used for capital expenditure, and Rs 77 crore for working capital requirements.

Also, the debts amounting to Rs 43 crore will be repaid via issue proceeds, and the remaining funds will be kept for general corporate purposes.

Most analysts had given a 'Subscribe' rating to the issue as the company is among the top three players in the writing instruments industry with a market share of approximately 9 percent in the overall writing and creative instruments industry in India. Its products are sold under four brands namely Flair, Hauser, Pierre Cardin, and ZOOX.