Vishal Mega Mart files updated IPO documents with Sebi; Eye 8,000-cr

Supermarket major Vishal Mega Mart filed revised documents with the capital markets regulator, SEBI, on Thursday to launch a ₹8,000-crore initial public offer (IPO). The IPO will be entirely an offer for sale (OFS) by the promoter, Samayat Services LLP, with no fresh equity shares being issued, as per the Revised Draft Red Herring Prospectus (UDRHP).

Samayat Services LLP currently holds a 96.55% stake in the Gurugram-based retail chain.

Since the IPO is a complete OFS, the proceeds from the issue will go directly to the shareholders, and the company will not receive any funds.

The revised draft filing follows SEBI’s approval of Vishal Mega Mart’s confidential proposal on September 25. The company initially submitted its proposal in July via the confidential submission route.

Under this process, SEBI reviews the confidential DRHP and provides comments. Following that, the company must file a confidential update (UDRHP-I) incorporating these comments, which is then open for public comment. After addressing the public’s input, companies are required to submit an updated DRHP-II (UDRHP-II).

Vishal Mega Mart caters to middle and lower-middle-income consumers across India, offering a range of in-house and third-party brands across three categories: apparel, general merchandise, and consumer goods (FMCG).

As of June 30, 2024, Vishal Mega Mart operated 626 stores nationwide and provided services through a mobile app and website.

A report by Redseer highlighted that India’s retail demand market was valued at ₹68-72 trillion in 2023 and is projected to grow to ₹104-112 trillion by 2028, with a compound annual growth rate (CAGR) of 9%. The shift towards organized retail is driven by factors such as quality expectations, a broader product range, better pricing (particularly in FMCG), urbanization, and growth opportunities for organized players.

The issue’s book-running managers include Kotak Mahindra Capital, ICICI Securities, Intensive Fiscal Services, Jefferies India, JP Morgan India, and Morgan Stanley India.