Flair Writing Industries IPO is off to a great start, with shares trading at a premium of ₹136 in the grey market. The strong growth in their writing instruments and stationery segment, along with impressive IPO subscription figures, are driving investor interest.
Flair Writing Industries Limited had a successful debut on Dalal Street on December 1st, with shares opening at a 65% premium over its issue price on both the NSE and BSE. This is a great start for the Mumbai-based writing instruments company!
Shivani Nyati, Head of Wealth at Swastika Investmart, commented that the listing exceeded expectations due to the company’s strong fundamentals and positive investor sentiment surrounding the IPO.
The grey market premium for Flair Writing shares ahead of its debut on the stock exchanges. The grey market is an unofficial platform where investors buy and sell shares before they are officially listed on stock exchanges.
The premium of ₹136 suggests that there is demand for Flair Writing shares even before they are available for trading on the exchange. Investors in the grey market are willing to pay a premium over the expected IPO (Initial Public Offering) price, indicating optimism or interest in the company.
It’s important to note that grey market prices are not official and can be volatile. The actual performance of the stock on the exchange after listing may vary. Investors should carefully consider the fundamentals of the company, its business prospects, and other relevant factors before making investment decisions.
What should investors do
According to Rajan Shinde, Research Analyst at Mehta Equities, Flair Writing Industries had a solid listing that exceeded expectations, thanks to the positive secondary market environment and high subscription demand from QIB investors. The company’s strong start was also aided by ample liquidity in the market.
Flair Writing Industries’ healthy IPO listing is well-deserved, thanks to high growth in writing instruments, diversification, and future expansion plans. Short-term investors should book profits, while long-term investors hold given healthy growth in the industry and strategic partnerships. The oversubscribed IPO is a testament to strong investor interest in a fundamentally sound company with a bright growth outlook.
About the offer
Flair Writing’s IPO was oversubscribed 49.28 times with the QIB quota at 122.02 times, NII portion at 35.23 times, and retail investor allocation at 13.73 times. The company raised ₹593 crore via its IPO route. The funds will be used to set up a manufacturing facility in Gujarat, fund capital expenditure and subsidiaries, and support working capital requirements.
Company overview
According to CRISIL, Flair Writing is one of the top three players in India’s writing instruments industry, with approximately 9% market share. The company’s revenue growth is higher than the industry average, with a CAGR of around 14% between FY17 and FY23. Flair Writing also reported the highest operating and net income margins of 17.8% and 9.6%, respectively, in FY22. The IPO will be the fifth listing among mainboard IPOs launched last week.
