Patel Retail Ltd, a supermarket chain operator, has successfully raised Rs 43.46 crore from anchor investors ahead of its Initial Public Offering (IPO). The company allotted 17.04 lakh equity shares at Rs 255 per share to a diverse group of institutional investors.

Anchor Investors

The anchor book saw participation from several notable investors, including:

• Chanakya Opportunities Fund
• BNP Paribas Financial Markets
• Maybank Securities
• Beacon Stone Capital
• Saint Capital Fund
• Pine Oak Global Fund

IPO Details

The IPO is scheduled to open for public subscription from August 19 to August 21. The offer comprises two components:

1. A fresh issue of 85.18 lakh shares
2. An offer for sale of 10.02 lakh shares by promoters

The price band for the IPO has been set at Rs 237-255 per share. At the upper end of the price band, the public issue is expected to raise Rs 242.76 crore.

Use of Proceeds

The company plans to utilize the funds raised from the IPO for:

• Debt repayment
• Working capital requirements
• General corporate purposes

About Patel Retail

Patel Retail operates 43 stores under the 'Patel's R Mart' brand. The company's focus is on tier-III cities and suburban areas, particularly in the Thane and Raigad districts of Maharashtra.

Financial Performance

Patel Retail reported the following financial results:

Table: Patel Retail Ltd Financial Performance

All figures in Rs crore

The company has shown a modest increase in both revenue and profit compared to the previous fiscal year.

Listing Date

The shares of Patel Retail Ltd are scheduled to begin trading on August 26.

Outlook

Investors and market watchers will be closely monitoring this IPO, as it represents an opportunity to invest in a growing retail chain focused on tier-III cities and suburban areas in Maharashtra. The company's recent financial performance and strategic focus on underserved markets may make it an attractive option for those looking to diversify their portfolio in the retail sector.

Patel Retail Ltd., a prominent Maharashtra-based retail supermarket chain, has opened its Initial Public Offering (IPO) for subscription. The company, known for its 'Patel's R Mart' brand, is seeking to raise Rs 242.76 crore through this public issue.

IPO Details

• Subscription Period: August 19-21
• Price Band: Rs 237-255 per share
• Issue Size: Rs 242.76 crore
• Fresh Issue: 85 lakh shares (Rs 217.21 crore)
• Offer-for-Sale: 10 lakh shares (Rs 25.55 crore)

Company Overview

Patel Retail Ltd. has established a strong presence in Maharashtra's retail sector:

• Store Count: 43 stores
• Geographic Presence: Thane and Raigad districts
• Retail Space: 1.79 lakh sq. ft.
• Product Range: Over 10,000 SKUs per store

Use of Proceeds

The company plans to utilize the funds raised from the IPO for:

1. Debt repayment
2. Working capital funding
3. General corporate purposes

Valuation and Recommendation

At the upper price band, Patel Retail Ltd. is valued at:

• P/E Ratio: 33.6x
• Post-Issue Market Cap: Rs 8,504 million

Anand Rathi, a financial services firm, has issued a 'Subscribe - Long-Term' recommendation for the IPO. However, they note that the offering appears fully priced at current levels.

Risk Factors

Potential investors should consider the following risks:

1. Geographic concentration in Maharashtra
2. Declining same-store sales
3. High debt-to-equity ratio of 1.34
4. Negative cash flows from operations

Financial Health

Investors are advised to carefully review the company's financials and risk factors before making an investment decision. While Patel Retail Ltd. has established a significant presence in Maharashtra's retail sector, its high debt levels and negative operating cash flows warrant careful consideration.

The IPO presents an opportunity for investors to participate in the growth of a regional retail chain, but it's essential to weigh the potential risks against the company's expansion plans and market position.