Talwalkars Better Value Fitness attracts 27% premium

Settles at Rs 162.60 on BSE

Shares of Talwalkars Better Value Fitness settled at 162.60 on BSE, at a premium of 27% over the initial public offer price of Rs 128. The stock debuted at Rs 138, at a premium of 7.81% over the initial public offer (IPO) price. On BSE, 1.84 crore shares were traded on the counter. The stock hit a high of Rs 167.70 and a low of Rs 132.

The current share price of Rs 162.60 discounts the company's year ended March 2009 EPS of Rs 1.50 by a PE multiple of 108.40.

Talwalkars Better Value Fitness had priced the initial public offer (IPO) at Rs 128, the top end of the Rs 123-128 per share price band. The IPO got strong response from investors, with foreign institutional investors (FIIs) making a beeline for the IPO. The issue was subscribed 28.39 times.

Category-wise subscription figures showed that FIIs put in bids for 5.46 crore shares as compared to 30.25 lakh shares reserved for the qualified institutional buyers (QIB) category as a whole. Domestic institutional investors, other than mutual funds, put in bids for 92.47 lakh shares. Mutual funds put in bids for 4.17 crore shares.

The non-institutional investors' (NII) portion comprising of corporates and high networth individuals was bid 51.47 times. The retail investors' portion was bid 8.4 times.

The company owns one of the largest and oldest fitness chains in India. The company (as of December 2009) owned 37 health clubs and operated 14 more through franchisee route across 24 cities in 11 states across the country. The company's health clubs offer a suite of standardised services like gym, spa, aerobics and health counselling under the brand name Talwalkars'.

Out of the IPO proceeds, around Rs 50 crore is to be used for setting up of additional health clubs, Rs 20 crore for repaying certain unsecured loans and remaining for meeting the issue related expenses.

Talwalkars Better Value Fitness reported a net profit of Rs 5.69 crore on sales of Rs 52.97 crore in the year ended March 2009.