Electronics Mart India : GMP Price, IPO Overview, Issue Size and Important Dates

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EMI IPO
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Electronics Mart India (EMI) a consumer durable is all set to launch its IPO with an issue size of INR 500 Cr. As of August 2022, the company had 112 locations in 36 cities. Its multi-brand outlets are known as Bajaj Electronics. Here are some important key points on EMI IPO.

Electronics Mart India IPO – Overview  

Electronics Mart India’s initial public offering (IPO) will begin on October 4, 2022 and will end on October 7, 2022. The Electronics Mart IPO aims to raise 500 crores through a fresh issue of 500 crores. Retail gets 35%, QIB gets 50%, and HNI gets 15%. 

In September 2021, Electronics Mart India filed DRHP with SEBI to raise around Rs 500 crore via fresh issue. The proceeds will be used by Electronic Mart India ltd for additional working capital needs of around Rs 220 crore and capital expenditures worth Rs 111.44 crore. In addition, the EMI would pay off its debt with Rs 55 crore. 
 

Electronics Mart India IPO –Tentative Dates 

IPO Issue Opening date 4 October 2022 
IPO Issue closing date 7 October 2022 
IPO Allotment Date 12 October 2022 
IPO Listing date 17October 2022 
DocumentsRHP
IPO LISTED AT NSE, BSE 

Electronics India Mart IPO–Industry Overview 

Rising consumer demands, rapid urbanization, the government’s emphasis on infrastructure investment, and expansion of the domestic manufacturing sector all contributed to India’s economy recording a strong 6.7% CAGR from fiscal 2015 to 2020. Fiscal 2022 GDP growth is anticipated to be 9.5% year-over-year; long-term growth (fiscal 2021–2026) is anticipated to be 7.2% CAGR. 

Electronics Mart India IPO- Retail industry overview
EMI- Industry Overview

Advantageous demographics 

India has one of the youngest populations in the world in the year 2020, with a median age of 28. End of 2020, over 90% of Indians are still under the age of 60, with 63% of those individuals falling between the ages of 15 and 59, according to CRISIL Research. Comparatively, in the US, China, and Brazil, the proportion of people under 60 years old was, respectively, 74%, 62%, and 78%. 

EMI- Retail demographics
EMI- Retail Demographics

Despite immediate effects, the industry’s long-term growth story is unaffected. Between fiscal years 2016 and 2020, India’s retail sector recorded a robust 9.5% compound annual growth rate (CAGR), supported by expanding urbanisation, nuclearization, higher disposable incomes, and improving affordability and consumer sentiment. 

In keeping with the drop in GDP and PFCE, the retail sector experienced a 7.5% year-over-year decline in fiscal 2021. Retail consumption had decreased since the Covid-19 pandemic-related countrywide lockdown was put into place. Consumer confidence and discretionary expenditure will increase due to pent-up demand and a more favorable economic outlook. Retail growth will be further fueled by increased investments from major merchants. 

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Electronics Mart India IPO: Growth drivers for organized Retail  

1.Demand side factors: 

  • India’s per capita income has been rising; in fiscal 2021, it increased by 3.1% year over year. It is anticipated to increase in the future at a significantly quicker rate of 6.7% CAGR over the next five years, driving retail growth. 
  • 90% of Indians were under the age of 60 as of 2020. A younger population has a larger propensity to spend money on the newest discretionary items, which could lead to increased retail consumption, particularly in the organized sector. 
  • The percentage of people living in urban areas has increased from 17% in the 1950s to 35% in 2020 and is predicted to reach about 37% by 2025. Urbanization growth and rising disposable incomes are positive signs for the retail sector. 
  • Consequently, there has been a steady change in Indians’ consumption habits. Demand for goods and services of higher quality, convenience cost and the desire for branded items has surged due to money. New products are being tested out by consumers. 

2.Supply Side factors: 

  • Easier access to credit: Easy access to credit has led to a large increase in the market for personal loans in India, driving rising spending on consumer durables and homes. Consumer spending has significantly increased in recent years as a result of how simple it is to make payments with credit and debit cards. 
  • Additional players are entering the finance industry. For instance, the Future Group and Bajaj Finance have partnered strategically to provide easy EMIs for the purchase of goods ranging from high-end consumer durables to garments and groceries. 

Electronics Mart India IPO –Company Overview 

Electronics India Mart Ltd is the fourth-largest retailer of consumer electronics and durable goods in India as of the end of the fiscal year 2020. Electronics India Mart Ltd dominate the states of Telangana and Andhra Pradesh in terms of income (Source: CRISIL Report). Since Electronics India Mart Ltd started operating as a company in 1980, our revenue from operations has been steadily increasing. With a revenue CAGR of 25.60% from Financial Year 2015 to Financial Year 2020, they have been among the fastest-growing consumer durable & electronics retailers in India (Source: CRISIL Report). Electronics Mart India Ltd have constantly shown profitability and strong operating results. 

Among its competitors, EMIL will have the highest EBITDA margins in the 2020 fiscal year. 

Even though the country was dealing with the COVID-19 epidemic and a statewide lockdown, EMIL was surprisingly able to surpass its previous operating revenue of 31,724.77 million in Financial Year 2020 and 32,018.76 million in Financial Year 2021, showing 0.93% year-over-year growth. Electronics Mart India ltd operated 99 stores across 31 cities and metropolitan agglomerations as of August 15, 2021, totaling 0.99 million square feet of retail space. 

Electronics Mart India IPO Details 

EMIL IPO Date Oct 4, 2022 to Oct 7, 2022 
EMIL IPO Face Value ₹10 per share 
EMIL  IPO Price ₹56 to ₹59 per share 
EMIL IPO Lot Size 254 Shares 
Issue Size 500 Cr 
Fresh Size 500 Cr 
Offer for sale NA 
Employee Discount 
Issue Type Book Built Issue IPO 
Listing At BSE, NSE 
QIB Shares Offered Not more than 50% of the Net Offer 
NII (HNI) Shares Offered Not less than 15% of the Net Offer 
Retail Shares Offered Not less than 35% of the Net Offer 
Company Promoters Pavan Kumar Bajaj and Karan Baja are the company promoters. 

Electronics Mart India IPO – National Footprints 

Based on high potential areas, EMIL has grown its commercial operations and established a market presence in the Tier I and Tier II cities in Andhra Pradesh and Telangana. EMIL opened 24 stores in Andhra Pradesh as of August 15, 2021, and 75 outlets in Telangana. EMIL gradually plan to expand network in the NCR region in pursuing defined cluster-focused expansion strategy. 

Electronics Mart India IPO- Consumer durables
Electronics Mart India – National Footprint

The Electronics Mart India has established numerous consumer durable and electronic retail locations with an assortment of various as well as specialized electronic products with the goal of delivering complete electronic solutions. It has 99 stores total as of August 15, 2021, 88 of which are Multi Brand Outlets and 11 of which are Exclusive Brand Outlets. EMI has 85 MBOs under the name “Bajaj Electronics,” one MBO under the name “Tirupati Electronics,” and two speciality stores under the name “Kitchen Stories” to meet the needs of EMIL clients who specifically need kitchen-related products. Additionally, EMIL is currently developing up another specialty store style called “Audio & Beyond” that will focus on high-end home audio and home automation systems. 

Electronics Mart India IPO – Proceeds 

EMIL is planning to use the Net Proceeds from the Issue for the following purposes: 

1. Financing capital expenses for opening new stores and expanding existing ones 

2. Financing increased working capital needs 

3. Repayment or prepayment, in full or in part, of all or a portion of borrowings obtained by EMIL 

4. General corporate purposes 

Electronics Mart India IPO – Management 

The following are the list of the Board of Directors of EMIL 

EMI IPO-Managemnt

Electronics Mart India IPO – Financial Statements 

In FY22, the company’s revenue from operations increased 36% to 434.9 crore from 320 crore in the same period last year, while profit after tax increased 77% to 104 crore from 58.6 crore. 

P&L
EMI VALUATION
EMI-Valuation

For the Financial Years ended 2019, 2020, and 2021, EMIL EBITDA was 2,159.94 million, 2,276.41 million, and 2,038.81 million, respectively. For the Financial Years ending 2019–2020 and 2021–2021, EMIL EBITDA Margin—which measures EBITDA as a proportion of total revenue—was 7.65%, 7.18%, and 6.37%, respectively. In the financial years 2021 and 2020, EMIL saw increases in revenue of 0.93% and 12.35%, respectively. 

Electronics Mart India IPO –Strengths 

  • Electronics Mart India, India’s fourth-largest retailer of electronics and consumer goods, is a market leader in South India. 
  • Electronics Mart India has a history of rapid growth in electronics and consumer goods, with consistent expansion and profitability that sets the industry standard. 
  • EMI’s lustre-based growth broadens its geographic reach and market presence. 
  • The operational flexibility provided by the Electronics Mart India business model contributes to the establishment of a long-term sustainable footprint. 
  • EMIL has a diverse portfolio of goods due to its in-depth knowledge of regional markets and product assortment expertise. 

 Electronics Mart India IPO – Weakness 

  •  The COVID-19 pandemic and the deteriorating general economic conditions that followed have had an impact on EMI business in previous fiscal years and could have a major future impact on business, results of operations, financial condition, and/or cash flows. 
  • For its product needs, EMI is reliant on outside sources. External suppliers’ inability or delay in delivering goods could have a materially negative impact on the company’s operations, financial performance, and reputation. 
  • The profits of EMI are heavily reliant on a small number of brands. EMI revenues and profitability can be negatively impacted by the loss of any of their main brands or a reduction in the supply or volume from those brands. 
  • If EMI fails to compete effectively in the marketplaces where they operate and fails to stay current on consumer trends and technological advancements, their market share may suffer. 

Electronics Mart India IPO Registrar 

KFin Technologies Limited 
Phone: 04067162222, 04079611000 
Email: einward.ris@kfintech.com 
Website: https://karisma.kfintech.com/ 

Company Contact Information 

Electronics Mart India Limited 
D. No: 6-1-91, Shop No. 10, 
Ground Floor, Next to Telephone Bhavan, Secretaria 
Saifabad, Hyderabad – 500 004 
Phone: +91 040 4875 1125 
Email: cs@bajajelectronics.in 
Website: https://www.electronicsmartindia.com/ 

Electronics Mart India IPO Lead Managers 

  1. Anand Rathi Securities Limited  
  1. IIFL Securities Ltd  
  1. JM Financial Consultants Private Limited  

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