SOURCE : NEW18 NEWS
Last Updated:January 15, 2025, 19:15 IST
Unlisted shares of Laxmi Dental Ltd are trading at Rs 554 apiece in the grey market, which is a 29.44 per cent premium over the upper IPO price of Rs 428. It indicates a strong listing gain for investors on January 20.
Laxmi Dental IPO.
Laxmi Dental IPO: The initial public offer (IPO) of Laxmi Dental Ltd has been closed at 5 pm on Wednesday. Till 5:00 pm on the final day of bidding on Wednesday, the IPO got a 114.14 times subscription receiving bids for 1,02,38,83,212 shares against 89,70,371 shares on offer.
So far, the quota for retail investors got subscribed by 75.1 times. The non-institutional investors (NII) portion received a 147.69 times subscription. The QIB category has been subscribed by 110.38 times.
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The IPO was opened on Monday, January 13. The price band of the Rs 698.06-crore IPO was fixed at Rs 407 to Rs 428 apiece.
The IPO allotment will likely take place on January 16, while the listing is scheduled to take place on both BSE and NSE on January 20.
Laxmi Dental IPO GMP Today
According to market observers, unlisted shares of Laxmi Dental Ltd are trading at Rs 554 apiece in the grey market, which is a 29.44 per cent premium over the upper IPO price of Rs 428. It indicates a strong listing gain for investors on January 20.
Laxmi Dental IPO: Analysts’ Recommendations
Most brokerage firms have given a subscribe rating to the IPO. However, there are also neutral rating to the IPO.
Anand Rathi: Long-Term Subscription Recommended
Analysts at brokerage firm Anand Rathi suggest subscribing to Laxmi Dental Ltd’s IPO for the long term, despite its relatively high valuation. At Rs 428 per share, the company is seeking a market capitalisation of Rs 23,522 million, with a price-to-earnings (P/E) ratio of 64.6x based on FY25 projected earnings. “This appears aggressively priced,” said analysts at Anand Rathi. However, they highlight that the company ranks among the top two dental laboratories in India by revenue and is the leading exporter of dental products.
“Going forward, growth is expected to be driven by trends such as changing regulatory requirements in the medical devices sector, the transition from unorganized to organized players, increasing awareness and demand for dental aesthetics, and the growing preference for metal-free dental products,” the brokerage noted. Given these factors, they recommend subscribing to the issue for the long term.
KRChoksey – Neutral Rating
KRChoksey maintains a neutral stance, stating, “Laxmi Dental is well-positioned with planned capex and a strategic shift toward branded products.” However, they caution that the “absence of long-term contracts introduces uncertainty to near-term growth prospects.” With a valuation of 93 times earnings, “the valuation appears expensive,” the brokerage concluded, assigning a neutral rating to the issue.
SBI Securities – Long-Term Subscription Suggested
SBI Securities analysts also recommend subscribing for the long term, although the company is priced at a high P/E of 94.6x at the upper end of the price band based on FY24 earnings. “In 1HFY25, the company reported 60.3% of its FY24 revenue and 95.6% of its EBITDA, reflecting a significant improvement in performance,” the brokerage said. Analysts believe that factors such as the shift from the unorganized to the organized segment, greater awareness and adoption of dental aesthetics, and the shift towards metal-free products are likely to drive growth. Additionally, the company has seen margin improvement from 4.0% in FY22 to 19.5% in 1HFY25, “driven by operational efficiencies.” The reduction in interest costs following debt repayment is expected to further improve profitability.
Laxmi Dental IPO: More Details
The IPO is a combination of a fresh issue of equity shares for up to Rs 138 crore and an OFS of up to 1.31 crore equity shares worth Rs 560 crore by promoters — Rajesh Vrajlal Khakhar and Sameer Kamlesh Merchant, and other shareholders, according to the Red Herring Prospectus (RHP).
Under the OFS, investor OrbiMed Asia II Mauritius Ltd will also offload shares of the leading B2C dental aligner company Laxmi Dental. The promoters and promoter group owned a 46.56 per cent stake in the company, while public shareholders held a 53.44 per cent holding.
As per the RHP, the net proceeds from the fresh issue will be utilised for repayment of debt, funding of capital expenditure requirements, investment in its subsidiary Bizdent Devices Pvt Ltd and general corporate purposes.
Laxmi Dental, an end-to-end integrated dental products company, has a comprehensive portfolio that includes custom-made crowns and bridges, branded dental products like aligner solutions and paediatric dental products.
The company’s shares will be listed on the BSE and NSE.
