Indigo Paints prices IPO at a discount to peers; only 99 times earnings
Lemon Tree Hotels has set a price band at Rs54-56 for shares issued in the Rs1000 crore IPO. Photo: iStockphotoPremium
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Consumer discretionary spends were among the most impacted by the pandemic. But for some reason, the already high valuations of paint stocks have become far more expensive in the past year. That is working in favour of Indigo Paints, which has priced its initial public offering (IPO) at ₹1,488-1,490 apiece.
An analysis by Anand Rathi Securities Ltd showed that at the upper end of the IPO price band, Indigo Paints is valued at 98.5 times its trailing 12-month (TTM) earnings. Its much larger competitors, Asian Paints Ltd and Berger Paints India Ltd, trade at price-to-earnings (PE) multiples of around 114 times and 128 times respectively, the broker said in a report on 16 January.