Dodla Dairy is approaching capital markets with its IPO which is scheduled to open for subscription on 16 June 2021. The offer’s dates clash with IPOs of KIMS, Sona Comstar and Shyam Metalics IPO. At the issue size of INR520.2 crore at the upper end of price band, it is the smallest IPO of the lot. Nevertheless, a 35% reservation for retail investors is a big positive. The south-based dairy player has already attracted strong demand in grey market. Here is a look at Dodla Dairy IPO GMP:
Dodla Dairy IPO details
| Subscription Dates | 16 – 18 June 2021 |
| Price Band | INR421 – 428 per share |
| Fresh issue | INR50 crore |
| Offer For Sale | 10,985,444 shares (INR462.49 – 470.18 crore) |
| Total IPO size | INR512.49 – 520.18 crore |
| Minimum bid (lot size) | 35 shares |
| Face Value | INR10 per share |
| Retail Allocation | 35% |
| Listing On | NSE, BSE |
Although the company’s PE ratio at the upper end of the pricing spectrum stands at 47.8 on FY2020 earnings, it has achieved tremendous savings in FY2021. Its annualized EPS for FY2021 stands at INR27.9 which translates into the PE range of 15.09 – 15.34. Its Return on Net Worth (RONW) for the latest nine months stood at 21.2%. These strong numbers is also a reason behind the exuberance in GMP rates which started at around 25% of the offer price.
Read Also: Shyam Metalics IPO explained in 10 points
Dodla Dairy IPO GMP (Grey Market Premium) rates
| Date | GMP (in INR) | Kostak (in INR) | Subject to Sauda (in INR) |
| 25 June 2021 | 80 | – | – |
| 24 June 2021 | 70 | – | – |
| 23 June 2021 | 75 | – | – |
| 22 June 2021 | 85 | 250 | 2,000 |
| 21 June 2021 | 80 | 250 | 2,000 |
| 18 June 2021 | 90 | 200 | 2,500 |
| 17 June 2021 | 90 | 200 | 2,500 |
| 16 June 2021 | 130 | – | – |
| 15 June 2021 | 160 | 250 | 3,500 |
| 14 June 2021 | 160 | 250 | 3,000 |
| 12 June 2021 | 120 | – | – |
| 11 June 2021 | 110 | – | – |
A look at the company’s financial performance in the recent years is enough to warrant this positivity. Dodla Dairy has a track record of profitable operations with growing revenues. Although profitability had been low, it has improved a lot in the latest nine months and let’s not forget that milk is a commodity product. Another strong point is the presence of private equity investors TPG and International Finance Corporation (IFC).
Dodla Dairy’s financial performance (in INR crore)
| FY2018 | FY2019 | FY2020 | 9M FY2021 | |
| Revenue | 1,597.0 | 1,699.4 | 2,145.6 | 1,417.0 |
| Expenses | 1,516.6 | 1,606.2 | 2,063.8 | 1,254.9 |
| Comprehensive income | 58.1 | 65.0 | 54.8 | 115.9 |
| Margin (%) | 3.6 | 3.8 | 2.6 | 8.2 |
