Kabra Jewels Lists at 90% Premium, Shows Strong Performance on NSE SME

resr 5paisa Research Team

Last Updated: 23rd January 2025 - 11:12 am

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Kabra Jewels Limited, a retail jewelry company operating since 2010, marked its entry into the public markets on Wednesday, January 22, 2025. The company, which has established itself with six showrooms in Ahmedabad offering gold, diamond, and silver ornaments under various brands including KK Jewels, commenced trading on NSE SME amid exceptional investor enthusiasm.

Kabra Jewels Listing Details

The company's market debut reflected strong investor confidence in its business model and growth prospects:

  • Listing Time & Price: When trading commenced at market open, Kabra Jewels shares debuted at ₹243.20 on NSE SME, delivering an impressive premium of 90% to IPO investors. This strong opening validates the market's recognition of the company's retail presence and brand value.
  • Issue Price Context: The considerable premium emerged after the company had strategically priced its IPO between ₹121 and ₹128 per share, ultimately fixing the final issue price at ₹128. This pricing approach successfully balanced retail investor accessibility with fair value for the company's growth potential.
  • Price Evolution: By 10:43 AM IST, investor enthusiasm continued to build, pushing the stock to ₹255.35, representing an outstanding gain of 99.50% over the issue price and hitting the upper circuit, demonstrating sustained buying interest throughout the early trading session.
     


Kabra Jewels First-Day Trading Performance 

The trading activity showed robust participation and strong investor conviction:

  • Volume and Value: Within the first few hours, 14.92 lakh shares changed hands, generating a substantial turnover of ₹37.36 crore. Notably, 100% of traded shares were marked for delivery, indicating pure investment interest rather than speculative trading.
  • Demand Dynamics: The stock's trading pattern showed overwhelming buying interest with orders for 4.10 lakh shares with no sellers at current levels, reflecting strong unidirectional interest post circuit filter.
     


Kabra Jewels Market Sentiment and Analysis

  • Market Reaction: Strong opening followed by upper circuit
  • Subscription Rate: The Kabra Jewels IPO was massively oversubscribed by 356.02 times
  • Pre-listing Interest: Anchor investors demonstrated strong confidence by investing ₹10.87 crore before the public issue

 

Kabra Jewels Growth Drivers and Challenges

Expected drivers of future performance:

  • Established brand presence
  • Product quality focus
  • Experienced promoters
  • Strong artisan relationships
  • Design and innovation capability
  • Efficient management team
  • Motivated workforce

 

Potential challenges:

  • High debt-to-equity ratio
  • Gold price volatility
  • Geographic concentration
  • Competitive market
  • Working capital intensity
     

Utilisation of IPO Proceeds 

The ₹40 crore raised through fresh issue will be used for:

  • Repayment of borrowings
  • Meeting working capital requirements
  • General corporate purposes
     

 

Kabra Jewels Financial Performance 

The company has shown strong results:

  • Revenue increased to ₹164.24 crore in FY2024 from ₹122.34 crore in FY2023
  • 8M FY2025 (ended November 2024) showed revenue of ₹125.48 crore with PAT of ₹8.81 crore
  • Net worth of ₹39.87 crore as of November 2024
  • Total borrowings of ₹103.07 crore

 

As Kabra Jewels begins its journey as a listed entity, market participants will closely monitor its ability to execute expansion plans and improve operational metrics. The strong listing and sustained momentum suggest robust investor confidence in the company's prospects in the jewelry retail sector, particularly given its established brand presence and diverse product portfolio, though high leverage remains a key area to watch.
 

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