RBZ Jewellers, a prominent player in the gold jewelry manufacturing sector, experienced a tepid debut on the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE) on Wednesday. The stock opened at ₹100 per share, aligning with its issue price, signaling a lukewarm market reception.
Leading up to the listing, RBZ Jewellers’ shares in the unlisted market held no premium, setting the tone for a neutral market debut. The Initial Public Offering (IPO) of RBZ Jewellers achieved an overall subscription of 16.72 times.
“RBZ Jewellers’ stock market debut mirrored pre-listing whispers, landing at Rs 100 per share, flat listing with zero listing gain on its issue price. This lackluster listing, in line with the subdued grey market trend, reflects cautious investor sentiment toward the company despite its apparent strengths,” said Shivani Nyati, Head of Wealth, Swastika Investmart Ltd.
RBZ Jewellers reported a commendable 55% year-on-year increase in net profit for FY23, amounting to ₹22.33 crore, driven by a robust operational performance. During the same period, the company recorded revenue of ₹288 crore, marking a growth of 14.2% compared to the previous fiscal year. The EBITDA surged significantly by 41% to ₹37.8 crore, and the operating margin expanded sharply by 249 basis points year-on-year to 13.11%.
For the first six months ending September FY24, RBZ Jewellers’ net profit stood at ₹12.09 crore, supported by a revenue of ₹125.5 crore.
Nyati also said that, While RBZ Jewellers possesses strong fundamentals and a fair valuation on the surface, the significant risks cannot be overlooked. The flat listing serves as a stark reminder of the potential pitfalls associated with gold price volatility, client concentration, informal artisan arrangements, and intense competition. Thus, investors are suggested to exit their positions.
Headquartered in Gujarat, RBZ Jewellers is a leading organized manufacturer of gold jewelry in India, specializing in antique bridal gold jewelry. The company serves as a key distributor to reputable nationwide retailers and significant regional players across 20 states and 72 cities in India.
