SD Retail Logo IPO: ₹124 to ₹131 Per Share - Opens 20th, Closes 24th September 2024

Incorporated in May 2004, S D Retail Limited designs, manufactures, outsources, markets, and retails sleepwear under the brand name "SWEET DREAMS". The company offers stylish and comfortable sleepwear for the whole family, designing products for men, women, and kids aged 2-16, with fits suitable for various body types. As of February 29, 2024, the company sold its products through distributors, exclusive brand outlets (EBOs), multi-brand outlets (MBOs), and e-commerce platforms. The company operates on an asset-light model, allowing for scalability and efficient opening of Exclusive Brand Outlets (EBOs). As of 31st May 2024, the company employed 240 individuals across various departments.

The Objectives of the Issue

S D Retail Limited intends to utilise the Net Proceeds from the Issue towards the following objectives:

1. Capital expenditure to be incurred by the Company for setting up new exclusive brand outlets ("EBOs")
2. Funding Working Capital Requirement
3. General Corporate Purpose

Highlights of SD Retail Logo IPO

SD Retail Logo IPO is set to launch with a book-built issue of ₹64.98 crores. The issue is entirely fresh. Here are the key details of the IPO:

• The IPO opens for subscription on 20th September 2024 and closes on 24th September 2024.
• The allotment is expected to be finalised on 25th September 2024.
• Refunds will be initiated on 26th September 2024.
• Credit of shares to Demat accounts is also expected on 26th September 2024.
• The company will tentatively list on NSE SME on 27th September 2024.
• The price band is set at ₹124 to ₹131 per share.
• The fresh issue comprises 49.6 lakh shares, aggregating to ₹64.98 crores.
• The minimum lot size for the application is 1000 shares.
• Retail investors need to invest a minimum of ₹131,000.
• The minimum investment for HNI is 2 lots (2,000 shares), amounting to ₹262,000.
• Beeline Capital Advisors Pvt Ltd is the book running lead manager for the IPO.
• Kfin Technologies Limited serves as the registrar.
• Spread X Securities is the market maker for the IPO.
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SD Retail Logo IPO- Key Dates

The cut-off time for UPI mandate confirmation is 5:00 PM on 24th September 2024. This deadline is crucial for investors to ensure their applications are processed successfully. Investors are advised to complete their applications well before this deadline to avoid any last-minute technical issues or delays.

SD Retail Logo IPO Issue Details/Capital History

The SD Retail Logo IPO is scheduled from 20th September to 24th September 2024, with a price band of ₹124 to ₹131 per share and a face value of ₹10. The total issue size is 49,60,000 shares, raising up to ₹64.98 crores through a fresh issue. The IPO will be listed on NSE SME. The pre-issue shareholding is 1,37,62,386 shares.

SD Retail Logo IPO Allocation & Minimum Investment Lot Size

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

Investors can place bids for a minimum of 1000 shares, with additional bids required in multiples of this figure. The table below illustrates the minimum and maximum investment amounts for retail investors and HNIs, expressed in shares and monetary values.

SWOT Analysis: SD Retail Ltd

Strengths:

• Established brand "SWEET DREAMS" in the sleepwear market
• Diverse product range catering to men, women, and children
• An asset-light model allowing for scalable operations
• Presence across multiple sales channels, including EBOs, MBOs, and e-commerce platforms

Weaknesses:

• Dependence on the sleepwear market segment
• Potential seasonality in sales

Opportunities:

• Expansion of the EBO network
• The growing e-commerce market in India
• Potential for international market expansion

Threats:

• Intense competition in the rapidly growing EV retail sector
• Regulatory changes affecting the EV industry
• Dependence on EV manufacturers for product supply and quality
• luctuations affecting client spending on technology solutions

Financial Highlights: SD Retail Ltd

Below are the financial results for the Fiscal years FY24, FY23, and FY22:

SD Retail Limited has shown significant growth in recent years. The company's revenue increased by 20%, and profit after tax (PAT) rose by 77% between the financial year ending with 31st March 2024 and 31st March 2023.

Assets have shown strong growth, increasing from ₹7,759.56 lakhs in FY22 to ₹12,225.54 lakhs in FY24, representing a growth of about 57.6% over two years.

Revenue has seen steady growth, rising from ₹12,873.65 lakhs in FY22 to ₹16,328.48 lakhs in FY24, marking an increase of 26.8% over two years.

The company's profitability has fluctuated over the years. Profit After Tax decreased from ₹1,011.06 lakhs in FY22 to ₹430.17 lakhs in FY23, but then increased significantly to ₹759.76 lakhs in FY24. This represents a 76.6% increase from FY23 to FY24, although it's still below the FY22 level.

Net Worth has shown consistent growth, increasing from ₹2,990.04 lakhs in FY22 to ₹4,179.98 lakhs in FY24, a growth of about 39.8% over two years.

Total Borrowings have increased substantially from ₹1,844.13 lakhs in FY22 to ₹4,354.72 lakhs in FY24, which may indicate significant investments in growth and expansion.

The company's financial performance shows a trend of strong revenue and asset growth, with improving profitability in the most recent fiscal year. The significant increase in borrowings, coupled with growing assets and revenue, suggests that the company is in an expansion phase. Investors should consider these trends and the company's growth strategy when evaluating the IPO.