Multibagger IPO: Motisons Jewellers shares rally over 400% from issue price in just 10 months

Multibagger IPO: Motisons Jewellers, listed on BSE and NSE, has delivered remarkable returns to its investors, soaring over 400 per cent in less than a year after its market debut.

The stock, which listed at a 98 per cent premium on NSE and 89 per cent premium on BSE in December 2023, has rallied 419.5 per cent to ₹285.75 (previous close) over its IPO price of ₹55. In addition, from its listing price of ₹103.90 on the BSE, the stock has given multibagger returns, surging 175 per cent.

Motisons achieved a record high of ₹329.90 earlier this month on October 1, 2024. However, it has since experienced a decline of over 13 per cent from that peak. Notably, the stock hit its 52-week low of ₹87.10 on December 29, 2023, soon after listing and has skyrocketed 228 per cent since then.

Overall in 2024 so far, the stock has climbed over 191 per cent, giving positive returns in five of the 10 months so far. It has shed over 6 per cent in October after two straight months of gains. The scrip advanced over 77 per cent in September and almost 15 per cent in August.

Q2 earnings & other developments

Motisons showcased strong growth in both revenue and profit as per its Q2 FY25 results. The company reported a 21 per cent increase in net sales to ₹109.34 crore, while net profit soared by 101 per cent to ₹10.40 crore, reflecting a significant improvement over Q2 FY24. The half-yearly results also indicated a positive trend, with net sales rising by 12 per cent to ₹198.06 crore and net profit expanding by approximately 57 per cent to ₹16.73 crore in H1 FY25 compared to H1 FY24. For the full fiscal year 2024, Motisons achieved a 14 per cent growth in annual net sales, amounting to ₹416.76 crore, and a 46 per cent increase in net profit to ₹32.23 crore compared to the previous year.

Additionally, the company announced a 1:10 stock split last month. According to an exchange filing, Motisons intends to subdivide each existing equity share with a face value of ₹10 into ten shares, each with a face value of Re 1. This stock split is subject to shareholder approval and any other necessary approvals. The record date for the split has been established for Saturday, November 9, 2024, to determine shareholder eligibility. The filing specified, “Sub-division/split of company’s 1 (one) Equity Share having face value of ₹10/- (Rupees Ten only) each fully paid-up, into 10 (Ten) Equity shares of the company having face value of Re 1/- (Rupee One only) each fully paid-up, subject to the approval of shareholders and such other approvals as may be required.”

IPO Performance and Subscription Details

The ₹151.09 crore IPO of Motisons Jewellers opened for public subscription from December 18, 2023, to December 20, 2023, and made its debut on the bourses on December 26, 2023. The price band for the issue was set between ₹52 and ₹55 per share.

The IPO received an overwhelming response, with subscriptions reaching 173.23 times the offered size within the three-day bidding window. Investors placed bids for 333.12 crore shares, compared to 1.92 crore shares that were on offer. The retail investor category was subscribed 135.60 times, while the non-institutional investors (NII) segment was booked 311.99 times. Institutional interest was also solid, with the qualified institutional buyer (QIB) category witnessing 135.01 times bids.

The issue was entirely a fresh issue of 2.75 crore shares with no offer-for-sale. The minimum lot size for an application was 250 shares and in multiples thereafter, making the minimum amount of investment required by retail investors ₹13,750.

The company plans to use the net proceeds from the fresh issue for several key purposes. These include repaying existing borrowings obtained from scheduled commercial banks, addressing the working capital needs of the company, and fulfilling general corporate objectives.

Holani Consultants Private Limited was the book-running lead manager of Motisons Jewellers IPO, while Link Intime India Private Ltd was the registrar for the issue.

Motisons Jewellers Limited is engaged in the manufacturing and retailing of jewellery in India. The company offers bangles, necklaces, earrings, pendants, bracelets, rings, nose pins, chains, and mangalsutras made of gold, diamond, kundan, pearl, silver, platinum, precious, semi-precious stones, and other metals. It also offers gold and silver coins, utensils, and other artifacts. Motisons Jewellers Limited serves its customers through its online platform. The company was founded in 1997 and is based in Jaipur, India.

Disclaimer: This story is for educational purposes only. Please speak to an investment advisor before making any investment decisions.