Admin
13 October 2023

Pramara Promotions IPO: Unleashing the Power of Promotional Marketing

Introduction:

Pramara Promotions Limited, established in 2006, is a promotional marketing agency specializing in the ideation, conceptualization, design, manufacturing, and marketing of promotional products and gift items. The company serves clients across various sectors, including FMCG, QSR, pharma, beverage companies, cosmetics, telecom, media, and more. Pramara Promotions offers a wide array of services, such as Cross Promotions, Loyalty and rewards, Corporate Gifting, Toy Retail, Sweepstakes promotions, and more. The company also manufactures products under an OEM arrangement, where it creates branded promotional merchandise like water bottles and pens.

IPO Overview:

The Pramara Promotions IPO was a fixed price issue valued at ₹15.27 crores, comprising a fresh issue of 24.24 lakh shares. The IPO bidding period opened on September 1, 2023, and closed on September 5, 2023. Allotment was finalized on September 8, 2023, and the shares commenced trading on the NSE SME on September 13, 2023. Priced at ₹63 per share, the IPO had a minimum lot size of 2000 shares, requiring an investment of ₹126,000 for retail investors. High Net Worth Individuals (HNIs) were required to apply for a minimum of 2 lots (4,000 shares), amounting to ₹252,000.

Key Players:

Fedex Securities Pvt Ltd served as the book running lead manager of the Pramara Promotions IPO, while Bigshare Services Pvt Ltd acted as the registrar for the issue. Pure Broking played the role of the market maker for the IPO.

Stock Performance:

As of September 27, 2023, Pramara Promotions Limited's stock (Arrow) was trading at ₹103.70, marking a 4.96% increase. The stock opened at ₹102.00, reached a high of ₹103.70, touched a low of ₹102.00, and had a previous closing price of ₹98.80. The total traded value amounted to 94,000 shares.

Ownership Structure:

Pre-issue shareholding stood at 95.41%, and post-issue, it was 69.81%.

Financial Performance:

Pramara Promotions demonstrated consistent growth in its financial performance. As of March 31, 2023, the company's assets were valued at ₹6,139.22 lakhs, with revenue amounting to ₹5,119.11 lakhs. Profits after tax reached ₹222.59 lakhs, and the net worth of the company stood at ₹1,596.50 lakhs, with reserves and surplus of ₹944.19 lakhs. The total borrowing as of that date was ₹3,330.78 lakhs.

Performance Indicators:

Key performance indicators for the Pramara Promotions IPO included a post-issue P/E (Price-to-Earnings) ratio of 25.61 and a Market Capitalization of ₹56.92 crores.

Objectives of the Issue:

The net proceeds from the IPO were allocated for the following purposes:

1. Funding working capital requirements.
2. General corporate purposes.

Expert Opinion:

Noted that Pramara Promotions Limited provides comprehensive services for promotional products and gift items, all under one roof. The company has exhibited steady growth in both top and bottom lines over the reported periods. Based on FY23 earnings, he suggested that the issue appeared to be fully priced, making it a potential option for well-informed investors looking for medium to long-term rewards.

Subscription Status:

The Pramara Promotions IPO generated significant interest, with a subscription rate of 25.71 times as of September 5, 2023. Retail investors showed robust participation with a subscription rate of 17.14 times. The QIB (Qualified Institutional Buyers) category had moderate participation, while the NII (Non-Institutional Investors) category displayed strong interest with a subscription rate of 33.99 times.

Conclusion:

Pramara Promotions Limited operates in the domain of promotional marketing, offering an array of services and products for clients across various industries. The IPO signifies the company's growth trajectory and expansion plans. With consistent financial performance and a fully priced IPO, potential investors should conduct thorough due diligence and consider their investment horizon when evaluating this opportunity.

Read More IPO related blogs - Meson Valves India IPO