Shringar House of Mangalsutra IPO opens with a healthy GMP. Should you apply?

Shringar House of Mangalsutra has opened its Rs 401-crore IPO for subscription today. The issue, priced in the band of Rs 155–165 per share, will close on September 12, with listing expected on September 17 on the NSE and BSE. At the upper price band, the company commands a market capitalization of about Rs 1,591 crore. The IPO comprises a fresh issue of 2.43 crore equity shares.

Ahead of the issue opening, the company raised Rs 120 crore from anchor investors, where marquee investors participated. Proceeds will be used mainly to fund working capital and for general corporate purposes. Choice Capital Advisors is the book-running lead manager.

GMP

Ahead of listing, the issue is commanding a grey market premium (GMP) of around 16%, indicating investor appetite for the jewellery manufacturer.


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Business profile

Founded in 2009, Shringar specializes in designing and manufacturing mangalsutras, a jewellery segment with strong cultural and ritual significance. Its portfolio spans over 15 collections and more than 10,000 SKUs, catering to both daily wear and special occasions.

The company serves 34 corporate clients, 1,089 wholesalers, and 81 retailers across 24 states and four union territories, besides international markets such as the UK, UAE, USA, New Zealand, and Fiji. Clients include Titan, Malabar Gold, GRT Jewellers, Reliance Retail, and Joyalukkas.

Shringar operates through a single manufacturing facility in Mumbai, staffed by 22 designers and 166 artisans. This integrated setup allows it to manage design, quality, and production in-house.

Financials and valuations

Revenues rose 30% to Rs 1,430 crore in FY25, while net profit nearly doubled to Rs 611 crore. EBITDA margin improved to 6.5%. At the upper band, the stock is valued at a P/E multiple of 26x FY25 earnings, which is at a discount to some listed jewellery peers.

Strengths and risks

The company benefits from an established client base and a broad design portfolio. However, its reliance on a single product category and a single facility in Mumbai raises concentration risks. Seasonal demand and dependence on a handful of corporate clients could also impact performance.

Should you subscribe?

Brokerage Master Capital Services has recommended an "subscribe" on the IPO, citing strong financial growth, a niche market presence, and reasonable valuations compared with sector peers. Investors with a medium to long-term horizon can consider subscribing.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)