Sai Silks Kalamandir LTD. IPO - Review,Valuation, Date & GMP

Sai Silks Kalamandir Limited - Complete Overview

Established in 2005, Sai Silks Kalamandir Limited is a leading retailer of ethnic apparel, especially sarees, in South India. It ranks among the top 10 retailers in South India in terms of both revenue and profit.

The company operates four different store formats:

1. Kalamandir: This store offers contemporary ethnic fashion for middle-income customers, featuring a wide range of fabrics such as Tusser, Silk, Kota, Kora, Khadi, Georgette, Cotton, and Matka.

2. VaraMahalakshmi Silks: Under this store format, the company specializes in premium ethnic silk sarees and handlooms, targeting weddings and special occasions. Their collection includes Banarasi, Patola, Kota, Kanchipuram, Paithani, Organza, and Kuppadam sarees, with a strong emphasis on handloom products like Kancheepuram silk sarees.

3. Mandir: This store offers ultra-premium designer sarees, catering to high net-worth individuals. The selection includes Banarasi, Patola, Ikat, Kanchipuram, Paithani, Organza, and Kuppadam sarees.

4. KLM Fashion Mall: This store focuses on providing value-fashion products at affordable price points. It consists different range of clothing options, including fusion wear, everyday sarees, and Western attire designed for women, men, and children.

In addition to physical stores, the company also sells its products through e-commerce platforms. As of July 31, 2023, Sai Silks Kalamandir Limited operates 54 stores across four South Indian states, offering a diverse range of products. 

As of July 31, 2023, the company boasts a customer base of over 5.98 million in India and has generated revenue totalling 13,514.69 million.

 

What does the company do? 

Sai Silks Kalamandir Limited operates as a retailer specializing in ethnic apparel, with a primary focus on sarees in south India.

 

 

Company Products 

The company offers an array of products, ranging from high-end and luxury sarees suitable for weddings, special occasions, and everyday wear, to lehengas, men's traditional attire, children's ethnic clothing, and affordable fashion items encompassing fusion wear and western wear for women, men, and children.

 

IPO Overview 

The Sai Silks Kalamandir Ltd IPO date is scheduled from September 20, 2023, to September 22, 2023. The IPO price range has been established at Rs. 210 to Rs. 222 per share. 

The anticipated listing for this upcoming IPO is on October 4, 2023. The company aims to raise Rs. 1,201.00 Crores through this offering. 

Out of the total shares being issued, 35% are allocated for retail investors, 15% for non-institutional investors, and the remaining 50% for institutional investors.

 

Sai Silks Kalamandir Limited IPO timetable (Tentative)

EVENTS	DATE
IPO Opening Date	20 September 2023
IPO Closing Date	22 September 2023
IPO Allotment Date	27 September 2023
Refund initiation	29 September 2023
IPO Listing Date	4 October 2023

 

Sai Silks Kalamandir Limited IPO Details 

IPO Opening & Closing Date	20 September to 4 October 2023
Face Value	Rs.2 Per Share
Issue Price	Rs.210 to Rs.222 per share
Lot Size	67 Shares
Price of 1 Lot	Rs. 14,874
Issue Size	54,099,027 Shares (aggregating up to Rs. 1,201.00 Cr)
Offer for Sale	27,072,000 Shares of Rs. 2 (aggregating up to Rs. 601.00 Cr)
Fresh Issue	27,027,027 Shares (aggregating up to Rs. 600.00 Cr)
Listing at	BSE, NSE
Issue Type	Book Built Issue IPO
Registrar	Bigshare Services Pvt. Ltd.

 

Sai Silks Kalamandir Limited IPO Lot Details 

Minimum Lot Investment (Retail)	1 Lot
Maximum Lot Investment (Retail)	13 Lot
Minimum Lot Investment (HNI)	14 Lot
Maximum Lot Investment (HNI)	67 Lot

 

Sai Silks Kalamandir Limited IPO Reservation

Institutional share Portion	50%
Non-institutional share Portion	15%
Retail share Portion	35%

 

Company Financial

Amount in Crores

Period	FY - 21	FY - 22	FY - 23
Total Assets	665.42	842.49	1220.45
Total Revenue	679.10	1133.02	1358.92
PAT	5.13	57.69	97.59
Net Worth	242.99	300.66	397.33
Reserve & Surplus	218.93	276.60	373.27
Total Borrowings	217.22	260.49	345.50

 

Contribution of the sales of sarees to the total revenue of the company

(Amount in Million)

Category	FY 21	FY 22	FY 23
Sarees	4,448.98	7,607.06	9,241.59
Other Products	2,322.49	3,686.17	4,273.10
Total	6,771.47	11,293.23	13,514.69

 

Total revenue from operations generated from the sale of sarees 

(Amount in Million)

Category	FY 21	FY 22	FY 23
Normal Category	2,651.15	4,294.20	5,133.93
Premium Category	1,387.09	2,581.25	3,188.21
Ultra-Premium Category	410.74	731.61	919.45
Total	4,448.98	7,607.06	9,241.59

 

Geographic-wise revenue from operations

(Amount in Million)

Particulars	FY 21	FY 22	FY 23
Telangana	2,845.31	5,115.90	6,064.35
Andhra Pradesh	2,611.15	4,153.44	4,429.38
Tamil Nadu	444.84	765.80	1,218.70
Karnataka	870.16	1,258.09	1,802.26
Total	6,771.47	11,293.23	13,514.69

 

Revenues of the company are split among the different sales channels:

(Amount in Million)

Category	FY 21	FY 22	FY 23
Physical	6,716.55	11,121.68	13,329.96
E-commerce	54.92	171.55	184.73
Total	6,771.47	11,293.23	13,514.69

 

Objective of the Issue 

The company will utilize the raised funds to fulfil the following objectives.

• Financing capital expenditures for the establishment of 30 new stores (referred to as "New Stores").
• Financing capital expenditures for the establishment of two warehouses.
• Fulfil the working capital needs of the company.
• Repaying or partially prepaying certain borrowings that the company has undertaken.
• Addressing general corporate purposes.

 

Promoters and Management of Sai Silks Kalamandir Limited

The promoters of the company included Nagakanaka Durga Prasad Chalavadi and Jhansi Rani Chalavadi.

Pre-issue Promoter shareholding	95.23%
Post-issue Promoter shareholding	60.80%

 

Peer Comparison

Here is a list of the company's peers:

Company Name	Total income (in Rs. million)	EPS (Diluted)	P/E
Sai Silks (Kalamandir) Limited	13,589.20	8.11	-
Vedant Fashions Limited	13,589.20	17.68	71.29
TCNS Clothing Co. Limited	12,175.98	(2.75)	NM
Go Fashion (India) Limited	6,771.94	15.33	87.74
Aditya Birla Fashion and Retail Limited	125,343.60	(0.38)	NM
Shoppers Stop Limited	40,788.60	10.51	69.34
Trent Limited	85,025.40	12.51	163.76

 

IPO's Valuations

With the Sai Silks Kalamandir Ltd IPO price range set at Rs. 210 to Rs. 222 per share and the company's EPS standing at Rs. 8.11, if we focus on the upper limit of the issue price for valuation, the company's P/E ratio is approximately 27.37.

 

Dividend Policy 

As per the Sai Silks Kalamandir Ltd DRHP, the company has not distributed dividends in the past, and there is no assurance that dividends will be declared or disbursed in the future.

 

IPO's Strengths

• A prominent player in the ethnic wear and value-fashion retail sector in south india, boasting a diversified portfolio of well-established formats supported by a targeted sales and marketing strategy.
• Distinguished as a leading apparel retail brand in India, characterized by a scalable business model.
• Demonstrating a robust presence across both offline and online marketplaces, featuring an integrated omni-channel network.
• A track record marked by consistent growth, profitability, and favourable unit economics, driven by an efficient operational approach.
• Benefiting from an experienced set of Promoters, a capable management team, and proficient in-house teams, all equipped with a proven track record of successful execution.

 

IPO Weaknesses

• The company's primary focus revolves heavily around the sale of women's sarees.
• One of the company's Promoters has pledged a portion of their Equity Shares and engaged in agreements with specific lenders for this purpose.
• The company operates within a market characterized by fragmentation, featuring numerous unorganized and single-store players.
• There is a potential for the company to face challenges related to labour disputes, slowdowns, and rising wage costs.
• The company has accumulated debt, and any failure to meet repayment obligations and other commitments outlined in financing agreements could have adverse repercussions on its operations.
• To continue its business operations, the company must secure or renew various approvals, licenses, registrations, and permits.

 

 

IPO GMP Today

Latest GMP of Sai Silks Kalamandir Ltd IPO is Rs.7.

 

Conclusion

The Sai Silks Kalamandir Ltd IPO presents a potentially attractive opportunity for investors seeking to venture into the garment sector. The company boasts a substantial customer base in South India and stands as a prominent brand in the ethnic wear segment. Investors are encouraged to consider a thorough analysis before applying for the IPO to maximize their potential gains.

 

Finowings IPO Analysis

Hope you enjoyed the Finowings IPO Analysis. We tried our best to give every required detail about the company that you should know before applying to the IPO. 

You must consult your financial advisor before making any financial decisions. 

To Apply for the IPO, Click Here.

 

To Read the Prospectus of the Company Click Here to Download the DRHP

 

 

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