WomanCart IPO: A Fashionable Venture into Beauty and Wellness
Introduction:
The e-commerce landscape is witnessing a stylish addition with WomanCart's recent IPO, a fixed price issue amounting to Rs 9.56 crores. Entirely a fresh issue, the IPO brings forth 11.12 lakh shares, marking a significant step in the company's growth strategy. The bidding phase, which took place from October 16, 2023, to October 18, 2023, saw a remarkable response. With allotments finalized on Monday, October 23, 2023, the shares made their debut on NSE SME on October 27, 2023.
Pricing and Investment Dynamics:
Priced at ₹86 per share, the WomanCart IPO provides investors with an opportunity to step into the glamorous world of online retail. The minimum lot size for an application is set at 1600 shares, requiring a retail investment of ₹137,600. High Net Worth Individuals (HNIs) have the option to invest in 2 lots (3,200 shares), totaling ₹275,200.
Market Performance Overview:
As of December 14, 2023, WomanCart Limited (WOMANCART) stood at ₹147.90, reflecting a 4.98% decline. The stock opened at ₹155.00, with a high and low of ₹155.00 and ₹147.90, respectively. The previous close was ₹155.65, and the day saw a total traded value of 9,600 shares, providing insights into recent market trends.
Key IPO Highlights:
- - IPO duration: October 16, 2023, to October 18, 2023
- - Listing Date: October 27, 2023
- - Face Value: ₹10 per share
- - Issue Price: ₹86 per share
- - Lot Size: 1600 Shares
- - Total Issue Size: 1,112,000 shares, aggregating up to ₹9.56 Cr
- - Fresh Issue: 1,112,000 shares, aggregating up to ₹9.56 Cr
- - Issue Type: Fixed Price Issue IPO
- - Listing At: SME, NSE
Equity Transition:
Pre-IPO, WomanCart had 3,096,000 shares in circulation. Post the IPO, this figure increased to 4,208,000 shares, indicating a significant shift in market dynamics.
IPO Reservation Dynamics:
Strategically, the IPO allocated 1,112,000 shares, with 56,000 (5.04%) for Market Makers, 528,000 (47.48%) for Non-Institutional Investors (NIIs), and an equivalent 528,000 (47.48%) for Retail Individual Investors (RIIs).
IPO Timeline Snapshot:
- - IPO Open Date: Monday, October 16, 2023
- - IPO Close Date: Wednesday, October 18, 2023
- - Basis of Allotment: Monday, October 23, 2023
- - Initiation of Refunds: Wednesday, October 25, 2023
- - Credit of Shares to Demat: Thursday, October 26, 2023
- - Listing Date: Friday, October 27, 2023
- - Cut-off time for UPI mandate confirmation: 5 PM on October 18, 2023
Lot Size Landscape:
Investors had the flexibility to bid for a minimum of 1600 shares and in multiples thereof. The table below outlines the investment parameters for retail investors and HNIs:
Application | Lots | Shares | Amount |
---|---|---|---|
Retail (Min) | 1 | 1600 | ₹137,600 |
Retail (Max) | 1 | 1600 | ₹137,600 |
HNI (Min) | 2 | 3,200 | ₹275,200 |
Promoter Holdings Shift:
Mrs. Veena Pahwa, the sole promoter of the company, held 78.01% of shares pre-issue. Post the IPO, her stake transitioned to 57.40%.
Company Profile:
Incorporated in 2018, WomanCart is an online retail platform specializing in beauty and wellness products. The platform offers a diverse range of skincare, hair care, and body care products for both men and women. The company boasts more than 100 skincare brands and operates an offline store in Shalimar Bagh, Delhi, inaugurated in April 2022. WomanCart has further expanded its footprint through four subsidiaries, acquiring existing online businesses.
The company also introduced its beauty brands such as Wondercurve, Sayda Jewels, Faeezah & Feya. WomanCart's business strategy revolves around quick delivery, customer satisfaction, and easy returns. Key strengths include a multi-channel approach, customer-centric focus, leveraging user-generated content, partnering with influencers, and deploying AI tools for a virtual try-on experience.
Financial Performance Overview:
As of August 31, 2023, WomanCart reported compelling financials:
- - Assets: ₹879.25 Lakhs
- - Revenue: ₹764.99 Lakhs
- - Profit After Tax: ₹54.35 Lakhs
- - Net Worth: ₹561.08 Lakhs
- - Reserves and Surplus: ₹251.48 Lakhs
- - Total Borrowing: ₹169.99 Lakhs
Key Financial Indicators:
- - Market Cap: ₹36.19 Crores
- - P/E (x): 50.67
- - Post P/E (x): 14.65
- - ROE: 15.11%
- - ROCE: 17.97%
- - Debt/Equity: 0.1
- - EPS (Rs): 1.7
- - RoNW: 15.11%
Objects of the Issue:
The funds raised through the IPO are allocated for:
1. Branding and Marketing Expenses
2. App Development Expenses
3. Working Capital Requirements
4. General Corporate Purposes
5. Issue Expenses
IPO Review:
According to financial expert Dilip Davda, WomanCart is venturing into digital consumer-centric personal care product marketing. While its financial performance has been average, the asking price might not align with its current standing. The comparison with Nykaa is viewed with skepticism, and the small equity base post-IPO hints at a longer gestation for migration to the mainboard. The IPO's structured funding suggests a cautious approach, and well-informed or cash-surplus investors are recommended to consider it for potential long-term rewards.
IPO Subscription Status:
As of October 18, 2023, the WomanCart IPO subscription stood at an impressive 67.48 times. Retail investors subscribed 71.94 times, QIBs subscribed to times, and NIIs subscribed 56.30 times, reflecting a strong market interest.
Note: All financial figures are in INR (Indian Rupees), and market-related data is as of December 14, 2023.
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