Snapdeal IPO

Snapdeal, an e-commerce company, has filed for its upcoming initial public offering (IPO) worth Rs. 1,250 crores. The IPO comprises new issuance for Rs. 1,250 crores and an offer for sale of 30,769,600 equity shares (by SoftBank).

The company intends to invest Rs. 900 crores in organic growth initiatives and the rest for general corporate purposes. The company is also thinking of a pre-IPO placement worth Rs. 250 crores which will be deducted from the new issuance.

CLSA India Pvt Ltd, Axis Capital Ltd, BofA Securities India Ltd and JM Financial Ltd are the book running’s lead managers.

About Snapdeal

Snapdeal is an online marketplace started by Rohit Kumar Bansal and Kunal Bahl that offers a wide variety of products at competitive prices. Based on the total app installations in India, it is among the top four websites for online lifestyle shopping.

The company was created in 2007 as a company that distributed coupon booklets, but in 2010 it changed its business model to become an online deals marketplace. Next Snapdeal pivoted into an online e-commerce platform in 2012. They provide a wide range of goods, including clothing, household goods, electronics, mobile phones, cosmetics, personal care, etc.

Snapdeal IPO Objectives

The company primarily aims to utilise the funds raised from the sale of the newly issued shares:

  • To fund their organic growth initiatives
  • To use for general corporate purposes

The company also anticipates profiting from the broader boost in brand recognition that comes with becoming public.

Why you must invest in Snapdeal IPO?

  • It places emphasis on investing in technology that will enable it to outsmart powerful competitors.
  • India’s e-commerce industry is growing, particularly in Tier 2 cities where Snapdeal has a sizable consumer base.
  • Major corporations like Foxconn and Alibaba are supporting it.
  • They provide a great variety of goods sold for extremely affordable costs. Snapdeal’s merchants, per market trends, continuously update the items offered on the marketplace.
  • Snapdeal has created a discovery-led and personalised shopping experience for each customer by using artificial intelligence and machine learning.

The financial summary of Snapdeal is as follows:

(Rs. in Million) FY21 FY20 FY19
Revenue from Operations 4,717.56 8,463.99 8,394.28
Adjusted EBITDA (998.67) (3,200.62) (2,443.88)
Adjusted EBITDA Margin (%) (21.17) (37.81) (29.11)
PAT (1,254.40) (2,735.40) (1,880.31)
NAV per share (13.16) (16.57) (16.35)
EPS (3.18) (6.94) (7.23)

How can one apply for the Snapdeal IPO?

To apply for the Snapdeal IPO, follow the below steps:

  1. Select IPOs after signing in to your trading account.
  2. From the list of active IPOs, select the Snapdeal IPO.
  3. Specify the number of lots and the price you are interested in.
  4. Type in your UPI ID and press "Submit".
  5. You will receive a notification mandating money blocking in your UPI app.
  6. Accept the mandate request, and the funds will be blocked

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Frequently Asked Questions (FAQs)

No, the company has been incurring losses for the past few years.

After the Snapdeal IPO news, market sources estimate that Snapdeal might be worth between $1.5 and $1.7 billion.

The Snapdeal IPO comprises an offer for the sale of 30,769,600 equity shares and a new issuance for Rs. 1250 crores.

Snapdeal places a lot of emphasis on investing in technology that will enable it to outsmart powerful competitors. Moreover, India’s e-commerce industry is growing, particularly in Tier 2 cities where Snapdeal has a sizable consumer base. Major corporations like Foxconn and Alibaba are also supporting it.

Snapdeal is a public company, and it is soon coming with an IPO, after which its shares will be listed on the stock exchange.

Snapdeal has a good current ratio. Moreover, it invests a sizable sum of money, indicating that it is seeking expansion opportunities. It still is not a profitable company, but the fact that several influential investors support it is encouraging.

The allotment dates are not yet finalised.

The lot size has not yet been disclosed.

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Data Source - DRHP

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