What You Must Know About Baazar Style Retail IPO: Price Band ₹370 to ₹389 Per Share

Established in June 2013, Bazaar Style Retail Limited is a fashion retailer based in West Bengal and Odisha. The company provides a diverse range of apparel for men, women, boys, girls, and infants, along with general merchandise that includes non-apparel items and home furnishings.

The organisation is dedicated to creating a family-friendly shopping environment, emphasising the delivery of quality products while aiming to make stylish merchandise accessible to every Indian at reasonable prices. As of March 31, 2024, the average size of the stores was 9,046 square feet, with trained staff members available to enhance the overall customer experience.

The company is in Odisha, Bihar, Assam, Jharkhand, Andhra Pradesh, Uttar Pradesh, Tripura, and Chhattisgarh. As of March 31, 2024, Bazaar Style Retail Limited has successfully expanded its operations to nine states and manages 162 stores.

As of March 31, 2024, the company boasts an in-house marketing team comprising 13 professionals. Additionally, the company is supported by a robust design and merchandising team of 57 individuals who possess expertise in recognising and responding to the regional preferences of their target market. This team is committed to delivering the latest market trends, drawing on their extensive experience in the retail and textile sectors.

The Objective of the Issue

Prepayment or Repayment of Borrowings: The company intends to use a portion of the IPO proceeds to prepay or repay certain outstanding loans. This objective aims to reduce the company's debt burden, improve financial stability, and lower interest expenses, ultimately enhancing the company's overall financial health.

General Corporate Purposes: The remaining funds will be allocated towards general corporate needs, including working capital, operational costs, and other strategic initiatives. This flexibility allows the company to support its ongoing growth, improve operational efficiency, and respond to market opportunities.

Highlights of Baazar Style Retail IPO

Baazar Style Retail IPO is launching an initial public offering (IPO) with a total value of ₹ 834.68 crores. This offering consists of a fresh issuance of 0.38 crore shares, amounting to ₹ 148.00 crores, alongside an offer for sale of 1.77 crore shares, totalling ₹ 686.68 crores. Here are the key details of the IPO:

• The IPO opens for subscription on 30th August 2024 and closes on 3rd September 2024.
• The allotment is expected to be finalised on 4th September 2024.
• Refunds will be initiated on 5th September 2024.
• Credit shares to Demat accounts are also expected on 5th September 2024.
• The company will tentatively list on BSE NSE on 6th September 2024.
• The price band is set at ₹370 to ₹389 per share.
• The lowest lot size for the IPO application is 38 shares.
• Retail investors need to invest a minimum of ₹14,782.
• The minimum investment for sNII is 14 lots (532 shares), amounting to ₹206,948, and for bNII, it is 68 lots (2,584 shares), totalling ₹1,005,176.
• Axis Capital Limited, Intensive Fiscal Services Private Limited, and Jm Financial Limited are the IPO's book-running lead managers.
• Link Intime India Private Limited serves as the registrar.

Baazar Style Retail IPO - Key Dates

Baazar Style Retail IPO Issue Details/Capital History

The Baazar Style Retail IPO is set to open from 30th August to 3rd September 2024, with a price band of ₹370 to ₹389 per share and a face value of ₹5 per share. The IPO consists of a total issue size of 21,456,947 shares, raising up to ₹834.68 crores. This includes a fresh issue of 3,804,627 shares and an offer for sale of 17,652,320 shares. Employees receive a discount of ₹35 per share. The IPO will be listed on both BSE and NSE, with the shareholding increasing from 70.81 million to 74.62 million shares post-issue.

Baazar Style Retail IPO Allocation & Minimum Investment Lot Size

The IPO shares are allocated across different investor categories as follows:

A minimum bid of 38 shares is required from investors, with additional bids allowed in multiples of this figure. The following table outlines the minimum and maximum investment levels for retail investors and high-net-worth individuals (HNI), expressed in shares and corresponding amounts.

SWOT Analysis: Baazar Style Retail Limited

Strengths:

Strong Market Presence: Baazar Style Retail has an established brand with a broad customer base, enhancing its market penetration.
Revenue Growth: Consistent revenue growth demonstrates the company’s solid business model and effective operations.

Weaknesses:

High Competition: Operates in a highly competitive retail sector, which may pressure margins and market share.
Dependency on Domestic Market: Heavy reliance on the domestic market could limit growth opportunities and increase vulnerability to local economic fluctuations.

Opportunities:

Expansion Potential: Opportunities for expanding into new markets or product lines could drive future growth.
E-commerce Growth: Leveraging the e-commerce boom can increase reach and sales, especially in underserved regions.

Threats:

Economic Downturns: Economic slowdowns or changes in consumer spending habits could negatively impact sales.
Regulatory Risks: Changes in retail industry regulations or taxation could affect profitability and operations.

Financial Highlights: Baazar Style Retail Limited

Baazar Style Retail Limited's financial data for 31st March 2024 reflects a solid performance. The company reported total assets of ₹1,165.97 crores and generated revenue of ₹982.83 crores. Despite these strong figures, the Profit After Tax (PAT) was ₹21.94 crores, indicating modest profitability. The company’s net worth stood at ₹212.56 crores, supported by reserves and a surplus of ₹180.2 crores. Total borrowings amounted to ₹178.23 crores, highlighting a balance between equity and debt in the company’s capital structure. This data suggests steady growth, with room for improvement in profitability.