Jay Ambe Supermarkets Makes Modest Debut with 6.35% Premium, Opens at ₹79 Following Strong Subscription

Jay Ambe Supermarkets Limited, the retail chain operator, made a modest debut on BSE SME on September 17, 2025. After closing its IPO bidding between September 10-12, 2025, the company commenced trading with a 6.35% premium, opening at ₹79, exceeding the issue price of ₹78 and extending gains to hit the 5% upper circuit at ₹82.95, reflecting positive investor sentiment towards the regional retail sector.

Jay Ambe Supermarkets Listing Details

Jay Ambe Supermarkets Limited launched its IPO at ₹78 per share with a minimum investment of 3,200 shares costing ₹2,49,600. The IPO received an exceptional response with a subscription of 64.13 times - retail investors at 71.39 times, NII at outstanding 110.24 times, and QIB at a moderate 16.79 times, indicating strong investor interest across categories with particularly robust retail and HNI confidence in the franchise retail business model.

First-Day Trading Performance Outlook

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• Listing Price: Jay Ambe Supermarkets share price opened at ₹79 on BSE SME, representing a premium of 1.28% from the issue price of ₹78, delivering modest gains for investors and extending to hit the 5% upper circuit at ₹82.95 with overall gains of 6.35%.

Growth Drivers and Challenges

Growth Drivers:

• Established Franchise Model: Operating "City Square Mart" brand with 17 stores across Gujarat through a proven franchise model, allowing rapid expansion with lower capital requirements and established brand recognition in regional markets.
• Strong Financial Performance: Revenue grew 42% to ₹47.40 crore in FY25 with PAT surging 78% to ₹2.75 crore, demonstrating robust operational efficiency and successful business scaling in retail operations.
• Impressive Profitability Metrics: Strong ROE of 26.07%, solid ROCE of 24.12%, healthy PAT margin of 5.82%, and robust EBITDA margin of 10.53% indicating superior operational performance and capital utilisation efficiency.
• Diversified Product Portfolio: Comprehensive range including FMCG items, groceries, household merchandise, consumer durables, garments, footwear, and gift articles, providing multiple revenue streams and customer appeal.

Challenges:

• Regional Market Concentration: Heavy dependence on the Gujarat market with limited geographical diversification, creating vulnerability to regional economic conditions and restricted growth potential beyond local markets.
• High Valuation Concerns: Post-IPO P/E of 25.15x and price-to-book value of 6.20x reflecting premium valuation multiples requiring sustained growth execution to justify investor expectations in the competitive retail sector.
• Small Scale Operations: Small issue size of ₹18.45 crore and limited store network of 17 outlets, indicating restricted operational scale and competitive positioning against established retail chains.

Utilisation of IPO Proceeds

• Store Acquisition: ₹4.25 crore for the purchase of an existing store at Nana Chiloda, Ahmedabad, enhancing retail footprint and market penetration in key locations.
• Expansion Investment: ₹4.63 crore for the purchase of fit-outs for three new stores supporting geographical expansion and capacity enhancement initiatives.
• Working Capital: ₹4.50 crore for working capital requirements supporting inventory management, operational needs, and business growth in retail operations.

Financial Performance of Jay Ambe Supermarkets

• Revenue: ₹47.40 crore for FY25, showing robust growth of 42% from ₹33.41 crore in FY24, reflecting strong same-store sales growth and successful business expansion.
• Net Profit: ₹2.75 crore in FY25, representing exceptional growth of 78% from ₹1.55 crore in FY24, indicating substantial operational leverage and margin expansion benefits.
• Financial Metrics: Strong ROE of 26.07%, solid ROCE of 24.12%, moderate debt-to-equity ratio of 0.64, healthy PAT margin of 5.82%, robust EBITDA margin of 10.53%, and estimated market capitalisation of ₹69.26 crore.