Patel Retail IPO subscribed 24 times on Day 3 so far, GMP rises to 18%; Check other key details

Patel Retail’s Rs 243 crore Initial Public Offering (IPO) garnered strong investor response, with overall subscription reaching 24 times on the third and final day of bidding. Demand was notably high across categories, with the retail segment subscribed 20 times and the NII portion oversubscribed by 38 times.

According to market observers, the IPO is trading at a grey market premium (GMP) of 17.6%, suggesting optimistic sentiment ahead of its listing. On Wednesday, the GMP on the Patel Retail IPO stood at around 17%.

Patel Retail IPO Subscription Status

As of 10:10 AM on the third and final day of bidding, Patel Retail’s IPO witnessed an overall subscription of 24 times, indicating strong investor interest. Retail Individual Investors (RIIs) subscribed 20 times their allotted quota of 42.61 lakh shares, highlighting robust demand from individual participants. Non-Institutional Investors (NIIs), including high-net-worth individuals and other non-retail applicants, subscribed 38 times the available 23.67 lakh shares. Meanwhile, Qualified Institutional Buyers (QIBs) demonstrated solid participation as well, with their reserved portion of 11.36 lakh shares subscribed 17.3 times.

Patel Retail IPO GMP Update

The grey market premium (GMP) for Patel Retail currently stands at Rs 45. Based on the upper price band of Rs 255, this suggests a likely listing price of around Rs 300 per share, translating to a potential gain of approximately 17.6% for investors, assuming stable market conditions.

Patel Retail IPO: Structure and Use of Proceeds

Patel Retail’s Rs 243 crore Initial Public Offering (IPO) consists of a fresh issue of Rs 217 crore and an Offer for Sale (OFS) worth Rs 26 crore. At the upper end of the price band, Rs 255 per share, the company will issue approximately 95.2 lakh equity shares. Following the IPO, Patel Retail’s estimated market capitalisation is expected to range between Rs 792 crore and Rs 852 crore, depending on the final pricing. The IPO is open to retail investors with a minimum application size of 58 shares, and bids can be placed in multiples of this lot.

The proceeds from the fresh issue are intended to strengthen the company’s financial and operational footing. Of the total, Rs 59 crore will be used to repay existing debt, helping to lower interest costs and improve the company’s leverage position. Another Rs 109 crore is earmarked for meeting working capital requirements, ensuring smoother day-to-day operations and supporting business expansion. The remaining funds will be allocated to general corporate purposes, providing flexibility to pursue strategic initiatives and meet other operational needs.

Financial Snapshot

While Patel Retail’s revenue growth was moderate in FY25, it showed notable improvement in profitability. The company reported Rs 821 crore in revenue, with profit after tax rising to Rs 25.3 crore from Rs 22.5 crore in FY24. EBITDA stood at Rs 57.1 crore, with EBITDA margins improving to 7%, signalling better operational efficiency. The debt-to-equity ratio improved significantly—from 2.0x in FY24 to 1.3x in FY25—reflecting a healthier balance sheet.

Company Overview

Established in 2008, Patel Retail operates a value-focused supermarket chain primarily catering to tier-III towns and suburban markets across Maharashtra’s Thane and Raigad districts. It covers a total retail space of approximately 1.79 lakh square feet. Patel Retail offers more than 10,000 stock-keeping units (SKUs) across 38 product categories, including food, FMCG, apparel, and general merchandise. Patel Retail has also launched multiple private labels—such as Patel Fresh, Indian Chaska, Blue Nation, and Patel Essentials—many of which are manufactured in-house at its Ambernath facility.

Investment Outlook: Should You Subscribe?

SBI Securities has assigned a ‘Neutral’ rating to the IPO. At the upper price band, the stock is valued at 33.7 times its FY25 earnings, which is considered reasonable when compared with peers like Avenue Supermarts. However, the brokerage has cautioned investors about certain risk factors, including the company’s geographic concentration, reliance on key customers, and substantial working capital needs. As a result, SBI Securities anticipates limited listing gains and advises a cautious approach for potential investors.

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