IPO - New Listings Dec 08, 2016, 09.45 PM | Sleepwell mattress maker Sheela Foam is set to debut on bourses on December 9. It has fixed issue price at higher end of price band of Rs 680-730 per share. Like this story, share it with millions of investors on M3 Sheela Foam to list shares on Dec 9, sets IPO price at Rs 730 The Rs 510-crore initial public offer was oversubscribed 5.09 times on December 1, the last day for subscription. The issue was opened on November 29. Out of total issue size, Sheela Foam, on November 28, had raised around Rs 153 crore by allotting shares to anchor investors like Fidelity, Goldman Sachs, East Spring, HDFC MF, SBI MF, ICICI Prudential AMC, Premji Investment, IDFC MF and Sundaram MF. It was an offer for sale by Polyflex Marketing, the selling shareholder, which had 27.75 percent stake at the time of filing IPO papers. Hence, the company will not receive any issue proceeds. Promoters Sheela Gautam & Rahul Gautam held 56.41 percent stake in the company while the rest shareholding is held by other promoter group.
Sheela Foam also manufactures other foam-based home comfort products targeted primarily at Indian retail consumers, as well as technical grades of polyurethane foam for end use in a wide range of industries. Globally, it manufactures PU foam in Australia through wholly owned subsidiary, Joyce Foam Pty Ltd. The company, which has 12 manufacturing facilities, developed a pan-India distribution network consisting of over 100 exclusive distributors, more than 2,000 exclusive retail dealers and over 2,500 multi-brand outlets. The firm exports its products to 25 countries.The initial public offering of Sheela Foam Ltd, which makes mattresses under the Sleepwell brand, sailed through on the final day of the offering thanks to strong interest from institutional and affluent individual investors. The issue was subscribed a little more than five times at close, stock-exchange data showed on Thursday. The portion reserved for institutional investors was covered 14.5 times while the quota for non-institutional investors was subscribed almost three-and-a-half times.
Retail investors’ quota, however, was covered only 44%. The issue was covered just 1% at the end of day one and 6% at the end of day two. Sheela Foam joins a long list of companies such as PNB Housing Finance Ltd, RBL Bank Ltd, Quess Corp, Advanced Enzyme Technologies Ltd, Thyrocare Technologies Ltd and TeamLease Services Ltd that have seen strong demand for their IPOs this year. RBL Bank’s IPO was covered almost 70 times while that of Quess Corp was covered 144 times. The robust response to these IPOs comes after market volatility in the first half of this year had forced several firms to skip their planned share sales. However, a subsequent rebound in the secondary markets offered hope to companies looking to float IPOs. Sheela Foam’s IPO would also give hope to other companies such as drugmaker Laurus Labs Ltd that are in the queue to float public offerings because it comes in the middle of the government’s demonetisation drive, which banned Rs 500 and Rs 1,000 banknotes to combat graft, forgery and tax evasion but led to a severe cash crunch in the economy.
The poor show in the first two days was worrisome for Sheela Foam and its bankers because last week another IPO was scrapped after it failed to find institutional investors despite reducing the offer size and extending the issue period. The IPO of GreenSignal Bio Pharma Ltd was the first after the government kicked off the demonetisation drive. Sheela Foam is seeking a valuation of as much as Rs 3,561.14 crore (roughly $520 million) through the IPO. It had raised Rs 153 crore ($22 million) from anchor investors on Monday. The issue entirely comprises an offer for sale by one of the promoter companies, Polyflex Marketing Pvt Ltd, and the firm will not get any money from the IPO. The overall issue is worth Rs 510 crore ($77 million). After the issue, the promoter Gautam family is likely to retain around 86% stake in the company. Sheela Foam filed its IPO proposal with the Securities and Exchange Board of India in July. The company received regulatory clearance for the proposed IPO on 2 November.
In the grey market, Sheela Foam's shares continued to quote a discount to its price band of Rs 680-730 apiece, said two dealers on the condition of anonymity. One dealer maintained that retail investors kept funds reserved for Laurus Labs’s IPO, which opens on 6 December. Edelweiss Financial Services Ltd and ICICI Securities Ltd are the merchant bankers for the IPO.Sign up for our daily newsletter to get our top reports.Top 10 Mattress Brands in India As per a recently published report on the world mattress industry, the Indian mattress industry has seen an average yearly growth ranging between 10 and 15 percent. According to the same report, the top country in this regard is China, followed by Russia, Australia, Czech Republic, Brazil, Poland, and Austria. List of Top 10 Mattress Brands in India Kurl-on mattresses are made from the best materials and use the newest technology to make sure that the customers have a nice experience. It offers four types of mattresses:
Sleepwell is one of the top providers of sleep support products in India. It is the chief brand of the Sheela Group and has ISO 9001 certification as well. The company focuses on making the use of the very best and latest in global technology and creating products as per the demands of the consumers. Rubco mattresses are produced by Rubberized Coir Mattress Division of the Kerala State Rubber Co-operative Limited. It offers seven types of coir mattresses that serve the purposes of various types of users. The range includes the conventional mattresses, high end and luxurious ones, and the special orthopedic products. The size and thickness depends on the purpose for which the mattress is being used. Following are the various products of Rubco: The mattresses from Tempur-Pedic, a US based company, are made from materials that change according to the shape of the users. These also bring down the amount of motion transfer between two people using them. These are offered with limited warranties of 25 years and trial periods of 90 days.
These come in four ranges: The mattresses of Dunlopillo act according to the body contours of the person who is sleeping and this makes sure that he or she has a good and refreshing sleep. They come in 4 major ranges: Founded during 1957 MM Foam is a leading name in the world of sleeping products. It offers four types of mattresses that are capable of catering to the requirements of different kinds of people: Its mattresses are available in several ranges such as the following: Duroflex uses the Full Prone Support system to make sure its customers enjoy a refreshing sleep every day and stay healthy. Its mattresses come in various ranges such as: Sleepzone is owned by Real Innerspring Technologies Private Limited, which is among the top spring mattress manufacturers in India. The brand offers both non spring and spring mattresses and has been in the business for more than a decade. Its products are available for both home and hotels, in India and outside the country.
It offers a wide range of products such as the following: Europedic Organic Latex Mattress Galaxy Bonnell Pro Spring Mattress Europedic Memory Foam Mattress King Koil mattresses are marketed in India by King Koil Sleep Systems (Private) Limited (KKSS), which itself is a sister concern of Dubai Furniture Manufacturing Co., LLC, which is held by the famed ARENCO Group. Over the years, the company has associated with chiropractic doctors and this has helped it produce some of the best sleep support systems suited to handle spinal issues. Its products come in 4 major categories: Restonic mattresses come in two major collections – ComfortCare Collection and HealthRest Collection. The company believes that it is the right of people to have a good night’s sleep and as such creates every product with better materials and with greater focus on various nuances. Following are some other mattress brands available in India: India Mattress Industry- Current Scenario
Godrejis looking to increase its share by 100 percent as far as the organized market for mattresses is concerned. The mattress segment is a critical component of the Godrej Interio Group and was introduced during 2007. Someshwar Prasad, the Product Head of the Mattress division, states that the company is aiming to take up its market share to 10 percent by the end of 2012 with regards to the organized sector. It is estimated that the organized market for mattresses in India is worth approximately INR 1500 crore and there are 3 major companies in this regard. The company is looking to come up with a greater number of stores, which will help to increase their retail footprints and help them realize their ambition. Prasad has stated that by the end of 2012 the company is looking to go up from 100 to 1500 retailers. It is also supposed to start 35 sleep studios, 4 of which will be located in Chandigarh. The total number of such studios to be opened in northern India is expected to be 12.
He has also introduced three new types of mattresses referred to as Reborn, Sleepmate, and CalmCruizer. It is expected that these will help in bolstering sales in the days to come. Spuhl AG, a firm based in Switzerland, opened its first international store at Hyderabad during February 2012. It is owned by Leggett & Plat Inc, which is based in the US. Leggett & Plat Inc is a maker of machines that are used to produce spring units that are employed in mattresses and upholstery and operates on a global scale. At present spring mattresses comprise less than 5 percent of the total production in the mattresses market in India. However, Spuhl is looking to operate well in the domestic market. Following its opening the company has sold 30 machines approximately, that are each capable of producing 80 springs in a minute. Some of the leading companies in India like Sleepwell and Kurl-on have purchased machines from it. The Sales Manager, Magnus Baumann, has stated that India is being perceived as a major market.
The company is planning to introduce other products such as pocket spring making machines and other spring makers that have even greater capacities. However, the whole process will be done in a phased manner. The company has entered into an agreement with Veda Marketing, based in Hyderabad, to strengthen its position in the Indian market. MV Ramesh, who works for Veda, has stated that they are looking to sell around 10 units of the spring making machines in 2012-13. Spuhl sells 200 models of these machines around the world every year and each machine costs approximately INR 1 crore. The company will be emphasizing to reach the smaller companies in India. The domestic makers of coir mattresses will be aiming to introduce more variety into its sleeping products thanks to increasing prices of latex. They are also facing more competition from the foam based mattress industry. S Sundaresan, the All India Coir Mattress Manufacturers Association President, was present when the showroom was launched.