Bectors IPO - Day 2 subscription - Angel Broking

Mr. Keshav Lahoti - Associate Equity Analyst, Angel Broking Ltd

Mrs. Bector IPO was subscribed by 11.4 times on the second day of issue. Retail portion was most subscribed by 16.4 times..Non institutional and QIB was subscribed 8.7 times and 4.7 times respectively. We expect the IPO to be subscribed maniy times as the investor interest is quite strong for this IPO. Due to over subscription in such a large number, investors won't get the desired lot in the issue.

Company is one of the leading brands in biscuits and bakery businesses in North India. It has established presence in the retail and institutional bakery business. Company also has wide spread and established sales and distribution network. Although, the outbreak of Covid-19 has an impact on the smooth running of the business, from which gradually things are coming back to normal. Company results were better than the industry in the first half of the fiscal 2021. Company peers such as Britannia Industries, Nestle India, Prataap Snacks and DFM Foods are trading at trailing PE of 50.2, 85.6, 57.1 and 97.6 respectively. On the other hand, the company is priced at trailing PE of 27.9. Given the significant discount compared to listed peers there is comfort on the valuation. We are positive on the long term growth prospects of the industry and the company, and hence recommended to "Subscribe" to the issue for long term as well as for listing gains.

Source : Equity Bulls

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