January 13, 2025, Laxmi Dental, India’s leading integrated dental products company, launched its Initial Public Offering (IPO) today, aiming to raise ₹698 crore. The IPO, priced in the band of ₹407–₹428 per share, has already received significant investor interest on its opening day.
Key Details of the IPO
- Issue Structure:
- Fresh Issue: ₹138 crore (32.24 lakh shares).
- Offer for Sale (OFS): ₹560 crore (1.3 crore shares) by existing shareholders, including OrbiMed Asia II Mauritius and company promoters.
- Price Band: ₹407–₹428 per share.
- Lot Size: A minimum of 33 shares, amounting to ₹14,124 at the upper price band.
- Subscription Period: January 13 to January 15, 2025.
Objective of the Issue:
- Reduce debt across the company and select subsidiaries.
- Fund capital expenditure for machinery upgrades.
- Infuse funds into its subsidiary Bizdent Devices.
Day 1 Subscription Status (As of 2:30 PM, January 13, 2025)
Laxmi Dental’s IPO has witnessed strong demand on the first day:
- Overall Subscription: 2.71 times.
- Retail Individual Investors (RIIs): Subscribed 7.95 times.
- Non-Institutional Investors (NIIs): Subscribed 1.23 times.
- Qualified Institutional Buyers (QIBs): Subscribed 0.98 times.
The robust subscription rates, especially in the retail category, reflect high investor confidence in the company.
Grey Market Premium (GMP)
As of today, the Grey Market Premium (GMP) for Laxmi Dental’s IPO is ₹165 per share. This suggests a potential listing price of ₹593, translating to a 38.55% premium over the upper price band of ₹428.
Anchor Investor Allotment
Prior to the IPO launch, Laxmi Dental raised ₹314 crore from anchor investors, indicating strong institutional interest in the company. Anchor investors include prominent names from domestic and global markets, enhancing the IPO’s credibility.
Company Overview:
Established in 1989, Laxmi Dental is India’s only integrated dental products company, offering a comprehensive range of products, including custom-made crowns and bridges, clear aligners, thermoforming sheets, and pediatric dental products. The company exports to over 90 countries and operates six manufacturing plants across India.
Financials:
For the fiscal year ending March 2024, Laxmi Dental reported revenue of ₹195.26 crore, up from ₹163.84 crore in the previous year, reflecting robust growth.
Use of Proceeds:
The net proceeds from the fresh issue will be utilized for:
- Debt Repayment: Reducing debt at the company and select subsidiaries.
- Capital Expenditure: Financing the purchase of new machinery.
- Investment: Infusing funds into the subsidiary, Bizdent Devices.
Analysts’ Recommendations
Market experts suggest subscribing to the IPO for both short-term listing gains and long-term growth. However, they note the IPO is priced aggressively with a Price-to-Earnings (P/E) ratio of 64.65 based on FY25 annualized earnings.
Pros:
- Diversified and integrated product portfolio.
- Strong export market presence.
- Growing demand for dental solutions, fueled by increasing oral health awareness.
Cons:
Dependence on exports exposes the company to global market fluctuations.
High valuation compared to peers.
Key Dates
Listing Date: January 20, 2025 (on BSE and NSE).
Subscription Window: January 13–15, 2025.
Allotment Finalization: January 16, 2025.
Refund Initiation: January 17, 2025.
Credit of Shares to Demat Accounts: January 17, 2025.
What Makes Laxmi Dental Stand Out?
- Integrated Model: Comprehensive in-house production capabilities.
- Technological Edge: Adoption of digital technologies for innovative dental products.
- Global Reach: Strong distribution network across 90+ countries.
- Industry Leadership: The only integrated dental products company in India.
The Laxmi Dental IPO has opened to strong investor interest, with oversubscription in the retail category and a high Grey Market Premium. The company’s strong fundamentals, global market presence, and promising financial performance make it a compelling investment for both short- and long-term horizons. Investors are advised to carefully evaluate their financial goals and consider subscribing to the issue.
Disclaimer: Investors are encouraged to review the company’s prospectus and consult financial advisors before participating in the IPO.
