Waterways Leisure Tourism IPO: Waterways Leisure Tourism IPO opens from today, know details?

Business Desk – Waterways Leisure Tourism IPO: The IPO of the country’s leading cruise company Waterways Leisure Tourism has opened for investors from today, June 23. Investors will be able to bid in this issue till June 25. The company has fixed the price band of Rs 769 to Rs 808 per share. This is a completely fresh issue of Rs 585 crore. That means there is no offer for sale (OFS) included in it. Before the opening of the IPO, the company has raised Rs 263.25 crore from anchor investors.

The lot size of IPO has been fixed at 18 shares. According to the upper price band of Rs 808, retail investors will have to invest at least Rs 14,544. The company has reserved 75% for QIBs, 15% for NIIs and 10% for retail investors.

Listing of shares may happen on July 1

According to the company, the allotment of shares is likely to be finalized on June 29. Investors who do not get shares will start getting refunds from June 30. Shares will be credited to the demat accounts of successful investors on the same day. Possible listing of the company’s shares on BSE and NSE will take place on July 1.

Cold response in gray market

IPO is not getting much enthusiasm in the gray market at present. The GMP of the company is running around Rs 12. On this basis, the possible listing of the share is considered to be around Rs 820, which is only 1.49% more than the issue price. GMP has ranged between Rs 10 and Rs 24 in the last six sessions, making strong listing gains less likely.

Raised Rs 263 crore from anchor investors

The company has allotted 32.58 lakh equity shares to eight anchor investors at a price of Rs 808 per share. These include Baroda BNP Paribas Mutual Fund, Cullinan Opportunities Fund, Zeal Global Opportunities Fund, M7 Global Fund, Nova Global Opportunities Fund, Stellar Growth Fund, ASAS Global Fund and Maybank Securities.

Brokerage’s ‘neutral’ rating

Swastika Investmart has given this IPO a ‘neutral’ rating. The brokerage says that the company has created a strong identity in India’s emerging cruise tourism market through the Cordelia Cruises brand. There has been continuous improvement in the company’s occupancy and passenger demand, due to which the company has now become profitable.

What risks were mentioned?

According to the brokerage, investors should keep in mind risks like fluctuations in fuel prices, reduction in occupancy levels and possible interruption in cruise operations. Apart from this, there has also been a decline in the EBITDA margin of the company in recent times.

Called valuation expensive

Swastika Investmart believes that the pricing of the IPO is quite aggressive. The company is coming into the market at around 101 times earnings valuation, which limits the margin of safety for investors. According to the brokerage, this issue may be suitable for long term investors, but has less attractiveness for those expecting listing gains.

Where will the funds raised be used?

The company will use Rs 585 crore from the IPO to repay the lease payments of its step-down subsidiary ‘Becruise Shipping and Leasing (IFSC) Private Limited’. Apart from this, some part of the amount will also be used for general corporate needs.

Country’s biggest cruise tourism company

The company operates India’s leading domestic ocean cruise service under the brand ‘Cordelia Cruises’. The company provides luxury cruise services on many sea routes in the country as well as select international destinations.

What is GMP?

Gray market premium (GMP) is the additional price at which IPO shares are bought and sold in the informal market before listing. GMP indicates the initial sentiment of investors, but does not guarantee the actual listing price of the share.