Cellecor Gadgets IPO Final Subscription Details

The IPO of Cellecor Gadgets Ltd closed on Wednesday, 20th September 2023. The IPO had opened for subscription on 15th September 2023. Let us look at the final subscription status of Cellecor Gadgets Ltd at the close of subscription on 20th September 2023. The price band for the IPO was fixed at ₹87 to ₹92 per share and the stock has a face value of ₹10.

About the Cellecor Gadgets IPO

The ₹50.77 crore IPO of Cellecor Gadgets Ltd comprises entirely of a fresh issue with no offer for sale (OFS) component. The Fresh Issue portion of Cellecor Gadgets Ltd entails the issue of 55.188 lakh shares at which at the upper band of the price range at ₹92 per share aggregates to ₹50.77 crore. The stock has a face value of ₹10 and retail bidders can bid in minimum lot size of 1,200 share each. Thus, the minimum investment of ₹110,400 in the IPO is the base limit. That is also the maximum that a retail investor can apply for in the IPO.

HNIs / NIIs can invest in a minimum of 2 lots of 2,400 shares worth ₹220,800 as the bare minimum investment. There is no upper limit for the HNI / NII category or even for the QIB category. Cellecor Gadgets Ltd will deploy the funds for working capital needs and for general corporate purposes. Post the IPO, the promoter equity in the company will get diluted from 69.95% to 51.54%. The issue is lead managed by Narnolia Financial Services Ltd, while Skyline Financial Services Private Ltd will be the registrars to the issue. Let us now turn to the final subscription details of the IPO as of the close of subscription on 20th September 2023.

Final subscription status of Cellecor Gadgets IPO

Here is the subscription status of the Cellecor Gadgets IPO as at close on 20th September 2023.

The issue was open for retail investors, QIBs and for the HNI / NIIs. There was a broad quota designed for each of the segments viz. the QIBs, the retail and the HNI NII. A total of 2,76,000 shares were allocated as market maker portion to SS Corporate Services and Kantilal Chhaganlal Securities, which will act as a market maker to provide bid-ask liquidity on the counter post listing. Market maker action not only improves liquidity in the counter but also reduces the basis risk. The table below captures the allocation reservation done for each of the categories out of the total number of shares offered in the IPO.

As can be seen, from the above table, the company had allocated 28.48% of its original issue size to anchor investors. The anchor allotment was done on 14th September 2023 and details and the anchor allocation was spread across 4 anchor investors. All the anchor allocation was done at the upper end of the price band at ₹92 per share. Out of the 15.72 lakh shares allocated under the anchor portion, India Ahead Venture Fund was allocated 26.64% of the anchor portion while Founders Collective Fund was allocated 26.41%. In addition, Meru Investment Fund was allocated 26.26% while AG Dynamic Funds Ltd got 20.69% of the anchor allocation. The anchor portion is adjusted to the overall QIB quota, which is reduced proportionately.

How subscription built up for the Cellecor Gadgets IPO?

The oversubscription of the IPO was dominated by the retail investors followed by the HNI / NIIs and the QIB investors in that order. The table below captures the day-wise progression of the subscription status of Cellecor Gadgets Ltd IPO.

It is clear from the above table that while the retail portion and the HNI / NII portion got fully subscribed on the first day of the IPO itself, the QIB portion got fully subscribed only on the last and final day even as the QIB portion saw flows bunched on the last day of the IPO. However, the overall IPO was fully subscribed on the first day itself although most of the traction was seen on the last day. All the 3 categories of investors viz., HNIs / NIIs, retail and QIB categories saw good traction and build up of interest on the last day of the IPO. There is an allocation of 2,76,000 shares to SS Corporate Securities and Kantilal Chhaganlal Securities for market making. The market maker offers two way quotes on the stock post listing using the inventory of shares and ensures that investors do not get overly worried about liquidity and basis risk in the early stages.

The IPO of Cellecor Gadgets Ltd opened for subscription on 15th September 2023 and closed for subscription on 20th September 2023 (both days inclusive). The basis of allotment will be finalized on 25th September 2023 and the refunds will be initiated on 26th September 2023. In addition, the demat credits are expected to happen on 27th September 2023 and the stock is scheduled to list on 28th September 2023 on the NSE SME segment. This is the segment, in contrast to the mainboard, where IPOs of small and medium enterprises (SMEs) are incubated.

A quick word on Cellecor Gadgets Ltd and the SME IPO

Cellecor Gadgets Ltd was incorporated in the year 2020 and is engaged in the procurement, branding and distribution of an array of electronic gadgets and equipment .These include television sets, mobile phones, smart phones, smart wearables, mobile accessories, smart watches, and neckbands. It runs one of the largest distribution and service networks for electronic equipment and smart products in India. The company has a network of more than 1,200 service centres and that is complemented by more than 800 distributors across the length and breadth of India. It largely markets through multi-product stores and currently its products are available through a network of more than 24,000 stores across India. It offers 300 products of different variations and has more than 100 million users across India. The sales of the company have more than doubled in FY23 over FY22.

Cellecor Gadgets Ltd operates across 3 critical business verticals. The first vertical centres around entertainment and communication products. These include smart and conventional television sets. These are available in stock and LED versions equipped with the latest Android ecosystem. It has more than 35 SKUs of televisions, 15 SKUs of sound systems and more than 70 SKUs of mobile phones. The second vertical pertains to peripherals. These include TWS earbuds, neckbands, and smart watches. Under this category, the company has more than 145 SKUs. Finally, there is the third vertical of modern accessories. This includes power banks, data cables, USB chargers, adapters, chargers etc. There are more than 40 SKUs under this category. Cellecor Gadgets Ltd markets its products through an omnichannel approach with weightage to online and brick-and-mortar selling.

The company has been promoted by Ravi Agarwal and Nikhil Agarwal. The promoter holding in the company currently stands at 69.95%. However, post the fresh issue of shares, the promoter equity holding will get diluted to 51.54%. The fresh issue funds will be used by the company for meeting its working capital funding gaps and for general corporate expenses. Narnolia Financial Services Ltd will be the lead manager to the issue, while Skyline Financial Services Private Ltd will be the registrar to the issue. The market making for the issue will be jointly done by SS Corporate Services Ltd and Kantilal Chhaganlal Securities Ltd.