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PC Jeweller Ltd IPO Review (Apply)

Review By Dilip Davda on Dec 3, 2012

PCJ IPOPC Jewellerss Ltd (PCJ) is an established jewellery retailer in North India with manufacturing facilities as well as retail and wholesale outlets. It is promoted by Mr Prem Chand Gupta and Mr Balram Garg. The company offers a wide range of products including gold jewellery, diamond jewellery and other jewellery including silver articles. PCJ's jewellery is 100% Hallmarked while Diamond jewellery is Certified. PC Jewellers is cognizant of the fleeting jewellery trends and the fashion in the contemporary market. One can find contemporary collections and spectacular styles invading all PCJ stores which have opened their doors to connoisseurs of exquisite jewellery. The company operates 30 showrooms under the 'PC Jeweller' brand located across 23 cities in north and central India. Company is planning to expand their showroom network across India, including in southern and western parts of India. They have manufacturing facilities at 5 locations.
In addition to its retail operations, the company also sells gold and diamond jewellery on a wholesale basis to other jewellery retailers in India. PCJ also exports gold and diamond jewellery on a wholesale basis to international distributors in Dubai, Hong Kong and Singapore.

The company mulls establishments of new showrooms and mobilize generate corpus fund. To part finance, it is offering 45,133,500 equity shares of Rs.10 each within a price band of Rs. 125-135.  Retail investors and eligible employees are entitled for a discount of Rs. 5 per share on final pricing. The issue comprises a net issue to the public of 44,775,000 equity shares and a reservation of 358,500 equity shares for subscription by eligible employees.  The issue shall constitute 25.20% of the post issue paid-up equity share capital of the company and the net issue shall constitute 25.00% of the post issue paid-up equity capital of the company. Issue opens for subscription on 10.12.12 and will close on 12.12.12. Minimum application is to be made for 90 shares and in multiples thereof thereafter. Post allotment, equity shares will be listed on BSE and NSE. With this float the company aims to collect Rs. 564.17 crore  to Rs. 609.30 crore based on lower or higher price band. IDBI Capital Market Services Ltd, Kotak Mahindra Capital Company Ltd and SBI Capital Markets Ltd are the BRLMs and Karvy Computershare is the registrar to the issue. CARE and CRISIL, both have rated this IPO at IPO Grade 3 indicating 'Average Fundamentals' of the company. The company also floats customer friendly schemes every year and is thus getting more business and fancy.

As far as BRLM's mandate performances are concerned, the first figure is for total mandate and in bracket are for failure to give listing gains. SBI Cap 22 (8), Kotak Mahindra Cap - 46 (13) and IDBI Capital - 16 (8).


Conclusion / Investment Strategy

As far company's performance is concerned, for last three fiscals it has posted average EPS of Rs. 13.40 and for first half of the current fiscal it stands at Rs. 10.60 along with NAV of Rs. 52.08. It has issued bonus in the ratio of 2 shares for every 1 share held in September 2011. Thus the asking price is at around 8.5 P/E on fully diluted equity and is thus priced reasonably compared to its peer that are quoting around 13 to 42 P/E. Considering fancy for gem and jewellery sector counters, investment is recommended.

Reviewer recommends Subscribing to the issue.

Review By Dilip Davda on Dec 3, 2012

Review Author

DISCLAIMER: No financial information whatsoever published anywhere here should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is purely for educational and information purposes only and under no circumstances should be used for making investment decisions. Readers must consult a qualified financial advisor before making any actual investment decisions, based on information published here. Any reader taking decisions based on any information published here does so entirely at its own risk. Investors should bear in mind that any investment in stock markets is subject to unpredictable market-related risks. The above information is based on RHP and other documents available as of date coupled with market perception. The author has no plans to invest in this offer.

(SEBI registered Research Analyst-Mumbai).


About Dilip Davda

Dilip Davda, a freelance journalist

Dilip Davda is veteran journalist associated with stock market since 1978. He is contributing to print and electronic media on stock markets/insurance/finance since 1985.

Dilip Davda is a leading reviewer of public issues and NCDs in the primary stock market in India. The knowledge he gained over 3 decades while working in the stock market and a strong relationship with popular lead managers makes his reviews unique. His detail fundamental and financial analysis of companies coming up with IPO helps investors in the primary stock market. Dilip Davda has a special interest in analyzing the SME companies and writing reviews about their public issues. His reviews are regularly published online and in news papers.

Email: dilip_davda@rediffmail.com

PC Jeweller IPO FAQs

  1. 1. Why PC Jeweller IPO?

    The initial public offer (IPO) of PC Jeweller Ltd offers an early investment opportunity in PC Jeweller Ltd. A stock market investor can buy PC Jeweller IPO shares by applying in IPO before PC Jeweller Ltd shares get listed at the stock exchanges. An investor could invest in PC Jeweller IPO for short term listing gain or a long term.

  2. 2. How is PC Jeweller IPO?

    Read the PC Jeweller IPO recommendations by the leading analyst and leading stock brokers.

  3. 3. PC Jeweller IPO what should investors do?

    PC Jeweller IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the PC Jeweller IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts in the above answer.

  4. 4. Is PC Jeweller IPO good?

    Our recommendation for PC Jeweller IPO is to subscribe.

  5. 5. Is PC Jeweller IPO worth Investing?

    As per the analysis by our lead analyst Mr. Dilip Davda, we suggest you to subscribe to the PC Jeweller IPO.

  6. 6. When will PC Jeweller IPO allotment status?

    The PC Jeweller IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit PC Jeweller IPO allotment status to check.

  7. 7. When will PC Jeweller IPO list?

    The PC Jeweller IPO will list on Thursday, December 27, 2012, at BSE, NSE.