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Electronics Mart India Limited IPO

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About :

Electronics Mart India Ltd., a Hyderabad-based company founded in 1980, would rank as the fourth-largest consumer electronics and durable goods retailer in the nation in terms of revenue in FY2020. Telangana and Andhra Pradesh are the states where the company is most prevalent. From FY15 to FY20, their revenue increased at a CAGR of 25.60%. 

Before expanding to further states throughout the nation, the corporation wants to further solidify its position in the southern region of India. As of August 15, 2021, the company operated 99 locations in 31 cities with a total retail space of 0.99 million square feet.

Out of the 99 stores, 8 are owned by the corporation, 85 are leased for an extended period of time, and 6 are partially leased and partially owned. In spite of the pandemic, the business opened 22 new locations in FY21.

Small appliances, mobile phones, major appliances including TVs, air conditioners, washing machines, and refrigerators, IT devices, and other items are all available from Electronics Mart India. Retail, wholesale, and online commerce make up the three channels that the business operates through. Out of the 99 stores the company was running as of August 15, 2021, 88 were MBOs and 11 were EBOs. 

There are 2 specialized stores that operate under the name “Kitchen Stories,” 85 MBOs that operate under the name “Bajaj Electronics,” one MBO that works under the name “Tirupati Electronics,” and so on. The company expanded into e-commerce in 2017, and in FY21, the revenue from online sales accounted for Rs. 44.46 crores, or 1.39% of the whole revenue from operations for that year.

Details on IPO :

The IPO for Electronics Mart India Ltd. begins on October 4 and ends on October 7. The IPO issue consists of a brand-new 500 crore rupee equity share issue. The price range is determined at Rs. 56 to Rs. 59, and the lot size is set at 254 shares per lot. While the IPO listing date is October 17, the shares will be distributed on October 12. The issue’s book running lead managers are JM Financial Ltd., Anand Rathi Advisors Ltd., and IIFL Securities Ltd. Pavan Kumar Bajaj and Karan Bajaj are the promoters.

Objective of the Issue :

1. The business will use the net proceeds to pay for capital expenditures, including the expansion and establishment of new stores and warehouses, totaling Rs. 133.87 crores.

2. The additional working capital requirements will be paid for with 200 crore rupees.

3. The company’s debts will be prepaid or repaid with 50 crore rupees.

IPO Key Points

Strengths : 

1. Electronics Mart India has a revenue leadership position in Southern India and is the fourth-largest retailer of consumer durables and electronics in India. They are primarily concentrated in the states of Telangana and Andhra Pradesh.

2. They have a history of steady expansion; as of August 15, 2021, they had 99 locations, up from 53 on FY19’s fiscal year-end.

3. They extend their stores using a cluster-based strategy, which helps them broaden their geographic reach and market presence.

4. The company offers a wide range of products that meet many of the demands and wants of the customer in one location.

The business operates 7 large warehouses that are rigorously controlled through IT and strict inventory control procedures.

Risks :

1. Any delay or disruption in supply will negatively affect business operations and financials because the company depends on outside suppliers for its products.

2. A fixed number of brands account for a sizable portion of the revenue. The profitability and income of Electronics Mart India will be impacted if the volume supplied by these brands decreases.

3. The market is accessible to new entrants, making it very competitive.

4. The corporation can experience losses on some of its investments as a result of expanding into new regions.

Steps to apply for Electronics Mart IPO:

Utilizing Application Supported by Blocked Amount, you can submit an application for the Electronics Mart IPO (ASBA). You can quickly use the online bank login and submit an application using your bank account by selecting the Electronics Mart IPO under the Invest section.

As an alternative, you can apply for the Electronics Mart IPO using the IPO forms that can be downloaded from the NSE and BSE websites:

  1. Go to the BSE or NSE site.
  2. Check out the Electronics Mart forms
  3. Download the blank IPO forms
  4. Fill up the form and submit it to your bank or broker.

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