Top upcoming 5 IPOs of your favourite Brands…!

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  1. VLCC.

    About Company

    VLCC is India’s first brand to have multi-outlet corporate operations in the Wellness and Beauty industry. The company was founded by Vandana Luthra as a beauty and weight management service in 1989 and incorporated in 1996. The company offers affordable beauty and wellness services to men and women.

    VLCC has won several recognitions, including ‘Superbrand’ by Superbrand India in 2017, India’s most trusted brand in the wellness segment in 2015 and 2019, and ASSOCHAM recognition in 2020.

     

    • The company will utilise the net proceeds from the fresh issues in brand development and expansion of VLCC Wellness Clinics in India and GCC regions.
    • They will use the funds to invest in digital and information technology infrastructure.

    VLCC Health Care IPO Details

    According to the primary draft submitted by VLCC Health Care Ltd., the public issue will raise Rs 300 crore in fresh shares, whereas the existing shareholders will sell up to 89 lakh from their stashes. VLCC is a brand recognised across India for its Beauty and Wellness services.

    Why should you invest in the VLCC Health Care Ltd. IPO?

    Here are our top reasons:

    • They are one of the largest and most successful brands in the domain.
    • They have built an integrated strategic business involving VLCC Wellness Clinics, Personal Care Products, and VLCC Institutes for skill development.
    • The Indian beauty sector will grow at a 10-12% CAGR in the next five years.

     

    IPO Financials

    Particulars FY21 FY20 FY19
    Revenue From Operation 5,329.18 7,695.68 8,524.26
    EBITDA 1,501.19 1,478.86 1,233.00
    EBITDA Margin (%) 26.6 19.1 14.3
    Profit After Tax 62.42 153.10 527.05
    EPS 1.62 4.09 12.93
    ROE NA NA NA

  2. Go Airlines

    About Company

    GoAir was founded in 2005 by Jehangir Wadia, son of Indian industrialist Nusli Wadia. The airline is a wholly owned subsidiary of the Wadia Group. GoAir commenced its operations using an Airbus A320 aircraft and operated its inaugural flight from Mumbai to Ahmedabad on 4 November 2005.

    Go Airlines, earlier known as Go Air, is planning to raise money through Initial Public Offerings. The company has filed DRHP with SEBI to raise Rs. 3600 crores. The offer consists only of fresh issues and no offer for sale.

    Go Airlines is one of the fastest-growing airlines in India. They are an ultra-low-cost carrier (ULCC) that focuses on maintaining low unit costs. The company’s main target customer consists of young Indians and MSME.

    The airlines have flexible and dynamic routes that allow them to increase or decrease the number of flights depending on the demands of the markets. With the increase in demand in the domestic market, the airlines have increased their routes between Tier 2 and Tier 1 cities, and also to various leisure destinations in India.

    They currently have an order book of 98 A320 NEO aircraft. They expected to take delivery of additional 8 A320 NEOs in FY2022, 14 in FY2023 and 154 in FY2024.

    Go Airlines IPO Objectives:

    • A part of the fund will be used in repayment of dues to Indian Oil Corporation Limited
    • The funds will be used for repayment of debts availed by the company

    Why should you invest in Go Airlines IPO?

    • India is one of the fastest-growing large aviation markets in the world. India has improved its ranking from 6th position in 2016 to the third position in 2019, behind US and China.
    • Though In 2020 the aviation industry faced a challenge due to the pandemic, steadily it has recovered. The domestic passenger traffic had rebounded to 64.1% of 12 months earlier. The international traffic is still continuing to recover, reaching 26.4%of pre-Covid level in Feb 2021.

     

    IPO Financials

    Particulars Fiscal 2020 Fiscal 2019 Fiscal 2018
    Total Equity 14,907.0 14,907.0 6,258.4
    Less: reserve on revaluation on land – – –
    Net worth as per regulation 2(1)(hh) of SEBI ICDR Regulation 14,907.0 14,907.0 6,258.4
    Profit attributable to the owners of the company 12,707.4 3,866.0 312.1
    Weighted average no.of Equity Shares outstanding during the period/year
    – For basic earnings per Equity Share 15,40,71,761 15,17,96,657 15,17,96,657
    – For diluted earnings per Equity Share 15,40,71,761 15,17,96,657 15,17,96,657
    Restated basic earnings per share (in ₹) 82.48 25.47 2.08
    Restated diluted earnings per share (in ₹) 82.48 25.47 2.08
    Return on net worth (%) N/A N/A N/A
    Net assets value per Equity Share of face value ₹10 (in ₹) 94.6 67.5 41.7
    EBITDAR 4,080.3 9,494.2 10,242.5
    EBIDTAR Margin (%) 5.6% 1.60% 22.3%
    EBITDA$ 3,392.0 9,419.7 10,242.5

    Know before investing

    Strengths

    3

    1. With their age being 3.7 years, Go Airlines is one of the youngest fleets in India and globally.
    2. The brand has the highest operational efficiency. They have the third-highest aircraft utilisation of 12.9 hours/day in India.
    3. Go Airlines’ market share has increased from 5.4% in fiscal 2010 to 10.8% in fiscal 2020.

    Risks

    3

    1. Any increase in the fuel price can have an adverse effect on the business and the operations of the company.
    2. Any pandemic like Covid-19 that can disrupt the operations and hence affect the finance of the company.
    3. Any unsuccessful attempts in implementation of any growth strategy can affect the business directly.

                                                                                                                                                                                                                            

  3. Ixigo                                                                                                                                                                                                                               

    About Company

     Ixigo is an Indian online travel portal, launched in 2007. Headquartered in Gurgaon, ixigo aggregates and compares real-time travel information, prices and availability for flights, trains, buses, and hotels, and allows ticket booking through its associate websites and apps.   

    The technology company, ixigo, was launched in 2007 with an aim to assist Indian travellers in managing, booking and planning their tours across hotels, buses, air and rail. It helps travellers to make smarter decisions through data science, machine learning and artificial intelligence-based innovations on its OTA platforms (apps and websites).

    With its focus on cost-efficiency, customer experience and travel utility, it has emerged as a leading travel ecosystem in India. The travel utility services and tools have been developed using crowd-sourced information and proprietary algorithms. The company is headquartered in Gurgaon, Haryana. ixigo now plans to float an initial public offering to reach new heights.

    Ixigo (Le Travenues Technology Ltd) IPO – Details

    On 12 August 2021, ixigo filed its preliminary papers with SEBI (market regulator) to fetch Rs. 1,600 crores through a public offer. As per the DRHP, the offering will comprise Rs. 850 crores as an OFS (offer for sale) and Rs. 750 crores as a fresh issue of equity shares.

    In this public offering, Micromax Informatics will offload shares worth Rs. 200 crores, and Saif Partners India IV has planned to sell shares amounting to Rs. 550 crores. Besides, Rajnish Kumar and Aloke Bajpai will sell Rs. 50 crores worth of shares each.

    Investment bankers such as Nomura, Kotak Mahindra Capital, Axis Capital and ICICI Securities are associated with this initial share sale. Follow the chart below for more details on this public issue:

    Ixigo IPO Objectives

    Ixigo will use the proceeds from its initial share sale for the following purposes:

    – For inorganic and organic growth initiatives.
    – For corporate purposes.

    Through this public issue, the company expects to enhance its brand name among potential and veteran users. Further, this initial share sale will mark a partial exit for Micromax and Elevation Capital.

    Why should you invest in ixigo IPO?

    Investing in the initial public offering of ixigo can be a rewarding choice due to the following aspects:

    • ixigo is the biggest online travel agency (OTA) for trains. The train-based apps, such as ConfirmTkt, account for a market share of 42% with respect to rail bookings in FY 21 for IRCTC.

    • Its bus-related app, namely AbhiBus, emerged as the second greatest bus ticketing OTA during FY 21, with 10% of the market share.

    • The total number of app users of ixigo stood at 37.48 million on the basis of MAU (monthly active users) in March 2021. This marks the highest app usage among the OTA platforms.

    • Since its inception, ixigo has raised $ 82 millions through secondary share sales and $ 58 millions from investors in the primary market. This makes it one of the least funded customer tech startups to touch the financial market.

     

    IPO Financials

    Financial Year Total Assets in Rs. crores Revenue from Operations in Rs. crores Profit After Tax in Rs. crores
    FY 2021 181.33 135.56 7.53
    FY 2020 70.13 111.60 26.61
    FY 2019 60.40 40.36 57.35

    Know before investing

    Strengths

    1. In July 2021, ixigo was recognised as the best online travel agency on the Google Play store, based on engagement and usage.
    2. The top management of this company is highly experienced and skilful, with industry-specific knowledge.
    3. The technology-related expenses of ixigo lead to lesser operational costs. As a result, the operating margin is higher, and it will reduce with the economies of scale.

    Risks

    1. Some travel suppliers can eliminate or reduce the incentive or commission payable to the company for ticket sales. This can significantly impact the operations and cash flows of ixigo.
    2. At present, the competitors of this firm have extensive market shares.
    3. There can be a lack of proper coordination with travel entities

  4. OLA

    About Company

    Founded in 2010, Ola is the biggest mobility platform in India. It is one of the greatest ride-hailing entities in the world, operating in over 250 cities across the UK, New Zealand, Australia and India. The recognised Ola app facilitates mobility services by offering a variety of vehicles such as cabs, metered taxis, auto-rickshaws and bikes. With its transparency and convenience, this company has a large customer base and more than 1.5 million empowered driver-partners.

    The headquarter of Ola is located in Bangalore, with Ankit Bhati and Bhavish Aggarwal as its founders. Through data sciences and engineering, the platform ensures a steady back-end system and offers a comfortable experience to the driver-partners and riders. Ola now plans to float its initial public offering to reach greater heights.

    Objectives of Ola IPO

    Ola wishes to utilise the proceeds from the pubic issue in the following manner:

    • To be updated
    • To be updated

    Why Should You Invest in Ola IPO?

    Following are the advantages based on which an individual can invest in the public offering of this cab aggregator:

    • Ola has emerged as a successful platform with over 1 billion rides served each year.
    • It also includes Ola Electric (the electric-vehicle arm) and Ola Fleet Technologies (the biggest fleet management business in India).
    • Ola Skilling focuses on ensuring livelihood opportunities for the youth in India.
    • It has acquired Ridlr, a leading ticketing and public transport commuting app in the country.
    • Further, it has invested in Vogo, which offers keyless scooter and bike rentals across Hyderabad and Bangalore.
    • It also extends its customer offerings such as credit led payments and micro-insurance via Ola Financial Services.
    • Under Ola Foods, it offers a variety of food brands via the biggest network of kitchens in India.

     

    IPO Financials

    Financial Year Total Assets Total Revenue Profit After Tax
    FY 2021 To be updated To be updated To be updated
    FY 2020 To be updated To be updated To be updated
    FY 2019 To be updated To be updated To be updated

    Know before investing

    Strengths

    1. Ola has the first-mover advantage in India as a cab aggregator.
    2. Several rounds of venture capital investments make the platform financially strong.
    3. Online application and rapid expansion enhance the business of this company.
    4. Acquiring TaxiForSure has improved the brand value of Ola.
    5. Users are highly aware of this platform as a result of print media and online as well as TV marketing.

    Risks

    3

    1. There is no clarity in the government regulations concerning the taxi service sector. The changing regulations and rules continuously threaten taxi providers.
    2. Ola faces tough competition from Uber and other local emerging platforms.
    3. The business model of Ola makes it difficult to control the cab drivers. Drivers play a crucial role in creating the brand image. If a driver misbehaves with the consumers, it will sabotage the reputation of this firm.

  5. OYO Electric 

    About Company

    Started in 2012 as Oravel Stays and later rebranded as the OYO Hotels and Homes is one of the popular Indian startups. It entered India’s hospitality segment with fresh ideas that plan to provide an affordable and improved experience to every guest. This idea of introducing a hotel chain came to its founder Ritesh Agarwal in 2011 when he noticed the dearth of quality budget hotels across the length and breadth of India.

    With his idea of bringing standardisation, he started OYO Hotels and Homes (then Oravel Stays). Following its debut, the company received funding from major venture capitals worldwide. In its 21 rounds of funding till 2021, OYO has garnered around $4.1 billion in funding. Some of the notable names in this list are SoftBank Group, Greenoaks Capital, Lightspeed India, and Sequoia Capital.

    In these past 10 years, OYO has successfully extended its operations outside India in Japan, South-East Asia, the USA, and Europe. Simultaneously, its presence in India has grown manifolds.

    OYO Hotels and Homes IPO Objectives

    • To prepay or repay debts availed of by different subsidiaries.

    • Support different organic and inorganic growth objectives.

    • Meeting general corporate purposes.

    • Carry out the offer for sale for participating stakeholders.

    OYO Hotels and Homes – IPO Details

    According to the DRHP filed by OYO Hotels and Homes with SEBI, the public issue is likely to be worth Rs. 8,430 crores. This will include an offer for sale of about Rs. 1,430 crores and a fresh issue equity share sale of Rs. 7,000 crores. Other details of this public issue, such as price band, market lot, and likes, have not been made public yet.

    Moreover, the allocation for various shareholder segments is not available as well.

    OYO Hotels and Homes has appointed the following as the book running lead managers of this IPO –

    • ICICI Securities Limited

    • Kotak Mahindra Capital Company Limited

    • JM Financial Limited

    • Citigroup Global Markets India Private Limited

    • J.P. Morgan India Private Limited

    • Deutsche Equities India Private Limited

    • Nomura Financial Advisory and Securities (India) Private Limited

    Apart from that, Link Intime India Private Limited is the registrar of this IPO.

    Why Should I Invest in the OYO Hotels and Homes IPO?

    Here are some reasons why you can consider investing in the initial public offering of OYO Hotels and Homes –

    1. The COVID-19 pandemic posed a significant financial challenge for the company and stretched its finances to limits. But, it has managed to recover from that position. With a new business approach, OYO Hotels and Homes are planning to trim its non-performing business portions and focus on generating greater returns.
    2. Microsoft has recently formed a partnership with OYO and invested a significant amount in developing an operating system. It will implement a SaaS service to aid businesses in the hospitality services to streamline their operations better.
    3. It still has the confidence of its stakeholders, even after recent legal and financial troubles, which is a sign of stability. It is always positive news.
    4. Lastly, the brand value of OYO is still a strong one and is expected to target a $10 billion valuation with this IPO.

     

    IPO Financials

    Financial year Profit After Tax Total Assets Total Income Total Expenses
    March 2021 Rs. 39,438.44 Rs. 87,510.48 Rs. 41,573.86 Rs. 69,360.75
    March 2020 Rs. 1,31,227.77 Rs. 1,41,089.82 Rs. 1,34,132.68 Rs. 2,28,001.20
    March 2019 Rs. 23,645.32 Rs. 1,17,426.08 Rs. 65,184.57 Rs. 88,094.28

    Know before investing

    Strengths

    1. OYO’s expansion has been one to take note of. From one city of India to a vast network covering South-East Asia, Europe, and the USA. Based on the customer demands, the company has increased its network.
    2. OYO’s expansion has been one to take note of. From one city of India to a vast network covering South-East Asia, Europe, and the USA. Based on the customer demands, the company has increased its network.
    3. OYO Hotels and Homes have led the segment with its innovation. They were the pioneers of budget stays in India and implemented this concept successfully. Also, after the recent turbulence, they have devised a change in a business plan to save the company.

    Risks

    1. Different brands are also entering this segment of budget hotels, which will bring strong competition to OYO.
    2. Apart from their OYO Rooms, other ventures of the company did not bring enough success.
    3. Since the base of OYO has been budget stays; the profit margins have consistently remained low.
    4. The company has been in a tussle with hotel owners and other associated parties over the revenue share. This has also hampered its operations significantly

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