Dreamfolks Services IPO opens
On August 24, subscriptions for Dreamfolks Services initial public offering (IPO), which aimed to collect Rs 562 crore from the primary market, were available. The price range per share set by the company is Rs. 308–Rs. 326. Dreamfolks Services’ initial public offering (IPO) has a lot size of 46 shares, which costs Rs 14,996. A retail investor may place bids for up to 13 items for a total of Rs 1,94,948. The deadline for the open bid is August 26, 2022.
With its distinctive, asset-light, capital-efficient business strategy, Dreamfolks Services, India’s largest airport service aggregator platform, has established itself as a market leader. With a market share of more than 80% in the domestic lounge access market, the company has emerged as a dominant force thanks to its first mover advantage in the Indian lounge access aggregator industry. Additionally, it has joined together with other organizations to make access to about 57 restaurants and F&B outlets at 18 airports throughout India easier. The whole proceeds of the IPO will be obtained by the selling stockholders, not Dreamfolks Services, who will not get any direct proceeds from the sale.
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The brokerage is certain that because of its market dominance, the company is well-positioned for the next growth possibilities as the aviation sector rapidly recovers from the uncertainties caused by Covid-19. By enhancing its touch points, the corporation has also been increasing its presence in the market for international air lounges. By strengthening its alliances with card issuers and other service providers, KRChoksey thinks it will be important for the business to expand in the local and international lounge services.
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The post-issue price-to-earnings (P/E) ratio is 104.8 times FY22 EPS in terms of value (at the upper end of the issue price band). Though the lower profitability brought on by pandemic-related problems in the entire business makes the multiple appear higher. Dreamfolks Services holds a 95% market share and has an advantage over later entrants in the sector. The preference of airline passengers has been gained by a company model with few assets. The business has also concentrated on expanding and diversifying its offering of services. In light of this, the brokerage has assigned the issue a medium- to long-term rating of “Subscribe.”