Winemaker Sula Vineyards’ IPO launches on Monday. What GMP signals ahead of subscription opening

Sula Vineyards IPO will be entirely an offer for sale (OFS) aggregating to 26,900,532 equity shares by the promoter, investors and other shareholders, which will include the sale of shares by Rajeev Suresh Samant, founder and CEO of Sula Vineyards as well as Belgian investment firms Verlinvest and Cofintra SA. 

“Sula is India’s largest wine producer and seller as on March 2022. Sula has posted impressive EBITDA and PAT growth but the revenues have remained steady. At the upper band, the issue is priced at p/e 52.57x which looks richly priced. Also, some factors like the issue being a pure ofs, low promoters’ holding and strict regulations and changing laws for the sector may impact investors interest,” said Abhay Doshi, co founder, UnlistedArena.

As per market observers, Sula Vineyards shares are commanding a premium (GMP) of ₹34 in the grey market today, lower from ₹29 yesterday. The company’s shares are expected to list on leading stock exchanges BSE and NSE on Thursday, December 22, 2022.

Named after Samant’s mother Sulabha, Sula planted its first vines in 1996, later building a sprawling resort and helping to cultivate a new reputation for Nashik as India’s wine capital. Since then Sula has grown to become India’s largest producer and seller of wine, with a portfolio of 56 labels from 13 of its own brands and 20 international ones. Its net revenue rose 8% year-over-year to ₹457 crore in fiscal 2022. Samant, 55, plans to sell around five percent of his 27% stake in the firm.

Sula Vineyards Limited is the India’s largest wine producer and seller as of March 31, 2022. The company also distribute wines under a bouquet of popular brands including RASA, Dindori, Satori, with its flagship brand Sula being the category creator of wine in India.