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Doms Industries IPO Details: Launch Date, Share Price, Size, GMP & Review

Doms-Industries-IPO-Details-Launch-Date-Share-Price-Size-GMP-&-Review

Doms Industries – About the Company

DOMS Industries Limited incorporated in 2006, is engaged in designing, developing, manufacturing, and selling a wide range of stationery and art products under the flagship brand name, DOMS. The company sells well-designed and high-quality stationery and art materials products that are divided into seven different categories - scholastic art materials, scholastic stationery, kits and combos, paper stationery, hobby & craft and fine art products.

The company has a presence in more than 40 countries covering the US, Africa, the Asia-Pacific, Europe, and West Asia. As of March 2023, for its core products for pencils and mathematical instrument boxes category, it is enjoying market shares of 29% and 30% market share, respectively. Furthermore, as of FY23, with a market share of 12% by value Doms Industries is the second largest player in India’s branded ‘stationery and art’ products market.

Doms Industries IPO Objectives

The total issue size will be Rs 1200 crore, out of which Rs 350 crore consists of fresh issue of shares, while Rs 850 crore is an offer-for-sale (OFS) of shares by the promoters. This means, more than 70% of the fund will go to the shareholders who are selling their stakes.

Apart from providing the opportunity to promoters to monetize their stakes, the main objective of the Doms Industries IPO is to finance the new manufacturing units that will be established to enhance the production capacity for its product range like writing instruments, watercolour pens, markers highlighters, etc. Part of the fund will be also used for general corporate purposes.

Doms Industries IPO Details:

IPO Open Date 13-Dec-23
IPO Close Date 15-Dec-23
Basis of Allotment 18-Dec-23
Listing Date 20-Dec-23
Face Value Rs 10 per share
Price ₹750 to ₹790 per share
Lot Size 18 Shares
Issue Size [.] shares
(aggregating up to Rs 1,200.00 crore)
Offer For Sale 10,759,493 shares
(aggregating up to ₹850.00 Cr)
Fresh Issue 4,430,380 shares
(aggregating up to Rs 350.00 Cr)
Issue Type Book Built Issue IPO
Listing At BSE & NSE
QIB Shares Offered Not less than 75% of the Net Issue
NII (HNI) Shares Offered Not more than 15% of the Net Issue
Retail Shares Offered Not more than 10% of the Net Issue

 

Doms Industries IPO Issue Price & Size

The Doms Industries IPO Issue Price will be in the range of ₹750 to ₹790 per share. Investors can bid in the IPO between these lower and higher price bands. The total issue size of Doms Industries IPO is Rs 1,200 crore out of which Rs 850 will OFS and Rs 350 crore will be fresh issue of shares.

Doms Industries IPO Launch Date

Doms Industries IPO will be open on 13 Dec 2023 and the last day of the IPO is 15 Dec 2023. The launch date is officially declared and investors who are looking to bid or invest in the Doms Industries IPO can bid between the 13 and 15 Dec 2023.

Doms Industries Financial Statements:

Particulars (Rs in Million) FY23 FY22 FY21 CAGR
Revenue from Operations 12,118.90 6,836.01 4028.17 73.45%
Other Income 46.33 26.24 59.71
Operational Expenses 9051.63 5334.84 3164.08
Other expenses 1200.68 804.04 563.84
EBITDA 1912.9 723.4 359.96 130.53%
EBITDA Margin% 15.78% 10.58% 8.94%
Depreciation 406.50 380.13 347.69
Interest 118.80 103.00 88.05
Profit Before Tax 1387.62 240.24 (75.78)  
Total tax 358.92 68.84 -15.53
PAT 1028.70 171.40 (60.25) 500% (YoY)
PAT Margin% 8.49% 2.51% -1.50%  
EPS Basic (Rs) 18.29 3.05 (1.07) 500% (YoY)

Source: DRHP

Doms Industries Financial Performance

In the first half of six months of FY24, the revenue of Doms Industries stood at Rs 764.22 crore. In FY23, the revenue was Rs 1,216.52 crore which has grown well at a CAGR of 73.45% from Rs 402.82 crore in FY21. The EBITDA of the company in FY23 was 191.3 crore which has shown an amazing CAGR growth of 130.53% from Rs 36 crore in FY21.

The PAT of the company stood at Rs 73.91 crore in the first half of FY24. In FY23 the PAT was Rs 102.87 crore and Rs 17.14 crore in FY22. However, in FY21 company incurred a loss of around Rs 6.03 crore. And gone from a loss-making company in FY21 to a profitable entity in FY22, FY23 and FY24, it has improved its operating and net profit margins.

In FY21, the EBITDA margin was only 8.94%, but thanks to better operating margins, the EBITDA margins reached to 15.78% in FY23. Similarly, in FY21 the net profit margin of the company was negative at 1.5%, but in FY23 it was plus 8.5% and in the first half of FY24, the same stood at 9.67% showing the company has improved its operating efficiency.

Doms Industries IPO Promoters & Shareholding of the Company

As per the draft red herring prospectus filed (DRHP), Italy’s FILA Group is the main promoter of the company holding a 51% stake in the company. Santosh Rasiklal Raveshia is the second largest shareholder among promoters with a 17% stake.

However, other major promoters of the company are Sanjay Mansukhlal Rajani, and Ketan Mansukhlal Rajani holding 8.63% stake each in the company. Chandni Vijay Somaiya, Sejal Santosh Raveshia, and Sheetal Hiren Parpani are holding a 4% stake each.

S.No. Name of the Shareholder No. of Shares % of pre-Offer Shareholding
1 FILA 28,687,735 51.00%
2 Santosh Rasiklal Raveshia 9,562,679 17.00%
3 Sanjay Mansukhlal Rajani 4,854,952 8.63%
4 Ketan Mansukhlal Rajani 4,854,952 8.63%
5 Chandni Vijay Somaiya 2,249,900 4.00%
6 Sejal Santosh Raveshia 2,249,900 4.00%
7 Sheetal Hiren Parpani 2,249,900 4.00%
  Total 54,710,018 97.26%

Source: DRHP

Why Invest in Doms Industries IPO?

Investing in any company launching IPO you should consider various factors. From the company's fundamentals to management of the company and financial performance there are various things you should consider while investing in any company listed or going to list in the stock market?Analyzing these factors will help you to know the strength of the company with the growth potential and future prospects of the management and the company itself.

Also Read: What to Check Before Buying IPO: Things to Know & Is it Safe

Apart from strength, there are also various risk factors involved while applying in the IPO of any company. Hence you must be aware of both aspects so that you can decide whether to invest in the company or not. Below we have mentioned some points to highlight the strength of the company and the risks associated with operating the DOMS.

Strengths:

  • In India, the education sector is likely to grow at a CAGR of 14% to touch $225 billion value by FY2025 from $117 billion in FY2020.And with the pace of this industry growth and having a pan-India and global network presence, DOMS Industries will be also getting the opportunity to increase its revenue in the coming years.
  • Moreover, the company has an exclusive tie-up with certain entities of the FILA Group for the distribution and marketing of their products in the Americas, Africa, Asia Pacific, Europe, in the Middle East and South Asia.
  • DOMS is the second largest pencil maker in India with a capacity of 6.5 million pencils per day and enjoys 29% and 30% market share, for its core products for pencils and mathematical instrument boxes respectively.
  • The company operates with a highly diversified product portfolio in different categories. Over the past years, the company has created a strong brand name that is backed by a strong network of domestic as well as international partners.
  • Earlier in 2023, DOMS acquired a 30% stake in the toy maker Clap joy providing the opportunity for the company to enter into new segments and add more revenue to its business with the diversification into new product categories.
  • At the financial end, the revenue of DOMS Industries has increased by 77.28% and profit after tax (PAT) rose by 500% between FY23 and FY22. The operating profit and net profit margins of the company have also improved well during the same period showing the capability to grow its revenue and net income in the near future.

Risks:

  • The major portion of the revenue of DOMS Industries comes from a single product which is a pencil made from wood. Manufacturing and selling this kind of product is not a bigger task for the other competitors, hence the business of the company is highly exposed to risk from entry of new rivals in the industry.
  • The company has no official contracts or agreements with its suppliers. Hence there is risk to the supply chain system of the company due to any disruption from the supplier’s side.
  • The products and their brand name can be easily copied by the local manufacturers, and this kind of fraudulent activity by smaller players will not only affect the revenue of the company but also damage the brand name of the company due to the supply of poor quality products in the market.
  • Some of the raw materials used in the production processes of DOMs Industries are natural resources and because of this, it is subject to the risk of depletion of such natural resources.
  • The preference of consumers keep changing with the new trend in the market, and launching new and innovative products as per the market trend is another challenging factor for the company that affect its business operations.
  • Failure to properly evaluate the demand for the top products and maintain the inventory levels as per the demand can increase the cost of holding the inventory. And control of the cost of production due to raw material costs will be always another challenge for the company to maintain or improve the operating and net profit margins of the company.

Doms Industries IPO Grey Market Premium

The Grey Market Premium (GMP) of Doms Industries IPO is trailing around Rs 450, and it will keep fluctuating till the date of listing of shares. The GMP is the premium over the issue price that is disclosed in the IPO for bidding. The GMP is defined as the supply of shares and demand in the grey market showing the sentiments of the investors.

Also Read: What is Grey Market Premium in IPO: How is GMP Calculated &Reliable

However, the GMP is not a reliable or stable criterion for knowing the listing price of any share as it can keep changing as per the demand for the shares and sentiments in the secondary market. However, you can use the GMP to guess the expected listing price.

Date Grey Market Premium (GMP)
Today ₹ 450
11-Dec ₹ 490
10-Dec ₹ 490
08-Dec ₹ 490

Doms Industries IPO Review & Analysis

The Doms Industries IPO comes with a Rs 1200 issue size giving an opportunity to the investors to apply in the IPO of a company having strong fundamentals and impressive financial growth. However, three years back, the company was running into a loss. But now DOMS has managed to operate with better efficiency and has become a profitable company.

Also Read: Why is Fundamental Analysis Important for Investing in Stocks

The price of Doms Industries IPO is not yet known, hence evaluating the share price as per its revenue and earnings is not possible. Without knowing the issue price it would be also not possible to compare the share price of Doms Industries with other peer group companies. Hence wait for the IPO price to be disclosed and then decide to apply.

However, if the Doms Industries IPO is issued at a very high price, means to say, if its price is expensive compared to its peer group companies in terms of valuation, then you can avoid subscribing to the issues. On the other hand, if the Doms Industries IPO is issued at a low price or available at a fair valuation or you can say at a discounted price compared to peers, then you can apply in the IPO. On the day of listing you can book profit or keep it for the long term.

Also Read: What is Profit Booking in Stock Market: Rules & Best Strategy

How to Apply for Doms Industries IPO?

To apply not only to Doms Industries IPO but IPO of any other company, you must have a trading account and demat account. If you don't have one, just apply here to open both these accounts with Moneysukh and follow the steps given below.

Also Read: How to Open Demat Account: Benefits and Documents Required

Steps to Apply for Doms Industries IPO:

Step 1: You can apply for the Doms Industries IPO once it is open for online bidding.

Step 2: Now navigate to trade.moneysukh.com and log in with your User ID & password.

Step 3: Here you need to open the IPO section and select the Doms Industries IPO.

Step 4: Now you have to fill in the required details like price, quantity, and so on.

Note: At the time of applying in any IPO, bid at the cutoff price before submitting your application. 

Step 5: Now make the payment online as per your selected lot size and submit successfully.

How to Check Doms Industries IPO Allotment Status?

The allotment status will show if you have been allotted any shares in the IPO. If you have applied and now want to check Doms Industries IPO allotment status you can use the various website with all your IPO application and PAN card details.

Also Read: How to check IPO allotment status on NSE, BSE through Moneysukh

Although, you can check the allotment status only when online bidding is closed and allotment is done. The allotment procedure is organized as per the subscription of bidding, if the IPO is oversubscribed, there is less chance of getting the allotments of shares.

Also Read: How to Increase the Chances of IPO Allotment

Depending on the Retail and HNI category IPO application and subscription, investors get the allotment of shares. If you have not been allotted any shares in the IPO, your money will be refunded back into your bank account or the fund will be unblocked if applied through ASBA. And luckily if you have been allocated any lot, then the shares will be transferred into your demat account before the day of listing that you can sell in the secondary markets.

Also Read: Benefits of Investing in the Stock Market: Advantages of Share Market

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