Motisons Jewellers Makes Blockbuster Debut With 98% Premium On Day 1

Sujeet Kushwaha

Motisons Jewellers share price clocked a bumper listing on the bourses today, rewarding investors with massive gains. The share debuted at ₹109 on NSE, a gigantic 98.18% premium over its issue price of ₹55 per share.

Motisons Opens At 103% Premium On BSE

On the BSE, Motisons Jewellers share price started off at ₹103.90 apiece, representing a huge 89% premium over the upper end of the IPO price band.

The stellar opening followed a highly oversubscribed IPO, which saw 159.61 times overall subscription last week. Analysts had predicted strong listing gains between 115-135% for the stock. Their estimates have proven right on the money.

IPO Received Overwhelming Response

The ₹36 crore public issue of Motisons Jewellers opened on December 18 and concluded on December 20. The IPO comprised a fresh issue of 2.74 crore shares at a price band of ₹52-55 per share.

It was overall subscribed 160 times by the closing date, signaling intense investor appetite. The qualified institutional buyers portion saw 263 times subscription, while non-institutional investors bid for a mammoth 551 times shares on offer. The retail portion was subscribed 23 times.

Grey Market Premium Indicated Strong Listing

In the grey market, Motisons IPO GMP (grey market premium) stood at ₹70 on Tuesday. This suggested high investor demand with an expected listing price of around ₹125, or 127% over the issue price.

What Motisons Jewellers IPO Proceeds Will Be Utilized For

As per its RHP, Motisons Jewellers intends to utilize the IPO proceeds of ₹36 crore for the following purposes:

1. Working Capital Requirements

A portion of the net proceeds will be used to fund working capital needs arising due to business growth. The company is expecting robust growth in operations.

2. General Corporate Purposes

Motisons will deploy some funds towards general corporate purposes to drive overall growth. This includes strengthening marketing capabilities and brand building exercises.

3. Repaying Existing Loans

Finally, a part of the IPO proceeds will go towards paying outstanding debt availed from banks. This will help optimize the capital structure and improve profitability.

Valuations Looked Reasonable Despite Premium Listing

Despite the massive 98% premium on listing day, Motisons Jewellers was valued at a P/E ratio of 15.3x based on its FY22 EPS of ₹7.1 per share.

The industry average P/E ratio for jewellery retailers hovers around 50-60x their earnings. Thus, Motisons was available at a significant discount compared to peers. This made the valuations appealing for long-term investors.

Strong Brand Recall To Aid Growth For Motisons

As one of the largest jewellery retailers in South India, Motisons enjoys fantastic brand recall and customer loyalty in its operating regions. Its flagship brand “Motisons” is a household name in Kerala.

The company is now expanding beyond Kerala into neighboring states to tap a larger share of the flourishing jewelry market. Its established brand image gives it an edge over regional competitors.

A widening retail presence outside Kerala, higher income levels and greater penetration in Tier 2-3 cities provide strong levers for growth in the coming years.

Robust Financial Performance A Positive Factor

Over the last three fiscals, Motisons Jewellers has delivered stellar financial performance:

  • Revenues have grown at 22% CAGR from 2018 to 2022 to reach ₹420 crores in FY22
  • Net profit has surged 34% annually from ₹6 crores to ₹19.5 crores

Its balance sheet was also healthy pre-IPO with efficient working capital management. Return ratios were solid with RoNW touching 28%. Its asset turns were also industry-leading.

This established track record of execution excellence helped build a positive outlook towards the IPO among investors.

Strong Investor Interest Owing To Attractive Jewellery Sector Dynamics

The wider jewellery sector in India exhibits promising long-term industry tailwinds:

1. Increasing Disposable Incomes

Surging GDP and higher per capita incomes are allowing greater spending on expensive jewelry, especially in Tier 2/3 cities.

2. Favorable Demographics

Rising marriageable age population and higher number of weddings per year leads to greater demand for gold ornaments and diamond jewelry.

3. Shift From Unorganized To Branded Players

Consumers are progressively moving towards branded chains owing to hygiene, pricing transparency and better designs.

These structural drivers attracted investor interest towards Motisons IPO and will continue benefiting organized jewellers with strong branding in the future.


Motisons Jewellers has witnessed a dream stock market debut with gains of almost 100% over its issue price. The exceptionally positive response underscores investors’ faith in its long-term business prospects.

With expansion plans on track, financial performance exemplary and sector dynamics favorable, Motisons seems well placed to capitalize on India’s flourishing jewelry market. The current valuations also appear reasonable considering its future earnings potential.

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Leveraging his government experience, Sujeet brings valuable insight on the stock market to readers. His passion for analysis drives coverage of equities and the latest financial news. When he's not busy dissecting stocks, Sujeet enjoys learning about new businesses and industries.
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