Vishal Mega Mart vs Mobikwik vs Sai Life Sciences: Which is a better pick?

The primary market is ending the calendar year 2024 with a bang, buoyed by a slew of companies launching their IPOs before the new year. Earlier today, three IPOs of Vishal Mega Mart, Mobikwik and Sai Life Sciences opened for subscription, leaving investors spoilt for choices.

However, Vishal Mega Mart emerged as the clear favourite among all the three IPOs, given that the company has priced the issue attractively (at P/E of 77.2x, lower than retail peers) and it is strategically positioned to benefit from India’s expanding retail market, particularly in tier-2 and tier-3 cities where organized retail penetration remains low.

At a PE of 77.2x its earnings, the company currently boasts a market capitalization of Rs 35,168.01 crore. However, one drawback is the complete OFS structure, where the promoter will offload around 102 crore shares.


"The company’s focus on cost-efficiency, consumer-centricity, and aggressive expansion in underserved markets strengthens its growth prospects. Additionally, Vishal Mega Mart boasts a strong customer loyalty program that enhances repeat business and engagement. Vishal Mega Mart is the top pick among the IPOs as it offers a compelling investment opportunity with a proven business model and significant room for growth," said Akriti Mehrotra, Research Analyst, StoxBox.

"Vishal Mega Mart's financial performance is also steady, with both revenue and profitability increasing in the last few quarters. For high-risk investors looking to gain exposure to the retail industry, this IPO is a good option," said Shivani Nyati, Head of Wealth at Swastika Invest.

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Meanwhile, if for any reason investors can't pick Vishal Mart's IPO, analysts preferred Mobikwik as the second option. The company is planning to raise Rs 572 crore through the issue and use the proceeds for growth in financial and payment services, research and development in AI and machine learning, and expansion of payment device infrastructure.

At its core, Mobikwik Systems is a platform company with a two-way payments network that includes both customers and merchants. The IPO is priced at 113.2x PE.

"Investors can apply for both short-term and long-term listing advantages because Vishal Mega Mart and Mobikwik Systems Limited appear to have sound financial figures and fair valuations," said Nyati.

Sai Life Sciences is the least preferred among analysts as the CDMO (contract research, development, and manufacturing) company priced the issue at high valuations and the offer includes a significant chunk of OFS.

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