Home-grown super-premium and luxury furniture brand Stanley Lifestyles received a “subscribe” rating from leading brokerages for its initial public offering (IPO), leading to the issue getting fully subscribed on the first day of bidding, indicating strong investor confidence in the company's brand and growth potential in the luxury furniture market.
One of the key strengths highlighted by analysts is Stanley Lifestyles' robust business model and diversified product portfolio. The company offers a wide range of luxury furniture items, that provide a wide range of home solutions offerings, such as sofas, arm chairs, kitchen cabinets, beds, mattresses and pillows, amongst others. Its customers can select from 10 different types of leathers and fabrics that it has in over 300 colours.
Stanley is the fourth largest player in the home furniture segment in India in terms of revenue in Fiscal 2023. It is among the first few Indian companies to venture into the super-premium and luxury furniture segment and one of the few Indian company present across various price points, i.e., super-premium, luxury and ultra-luxury segment, through its various brands.
Over the years, the brand has evolved from a sales-focused model to a design-led operation and has become a comprehensive provider of home solutions. It stands as the only super-premium and luxury Indian brand offering a wide range of home solution offerings, including sofas, armchairs, kitchen cabinets, beds, mattresses, and pillows, among others.
Furthermore, Stanley Lifestyles' has demonstrated consistent revenue growth, healthy margins, and efficient cost management, reflecting its operational excellence and financial stability.
Leading Brokerages in their IPO note stated that "Stanley Lifestyles (SLL), a leading super-premium and luxury furniture brand in India, has received an overall positive yet cautious endorsement from multiple brokerage firms regarding its IPO. They commend the company's significant market presence, robust revenue growth, and profitability. SLL is noted for its strong brand appeal, innovative design, and vertical integration.”
The brokerages have also highlighted its impressive financial performance with a high CAGR in revenue and profit between FY21 and FY23, alongside its strategic plans to expand retail operations using IPO proceeds. However, they express concerns about the high valuation, revenue concentration in South India, and dependency on limited suppliers for raw materials. Despite these risks, the consensus is that SLL is well-positioned to capitalize on industry growth trends, making it a promising long-term investment.
The Rs. 537 crores IPO consists of fresh issue and offer for sale and will be open for subscription on 21st June 2024. Ahead of its IPO, Stanley Lifestyles Limited, has garnered Rs. 161.10 crores from anchor investors namely SBI MF, SBI AF, Nippon MF, HDFC MF, East Spring Investment India, Quant MF, SBI Life Insurance, Loomis and Sayles, Optimix Wholesale Global Emerging Markets Emerging Markets Share Trust, Franklin India Opportunities Fund, Bandhan MF, Motilal Oswal MF, Max Life, Aditya Birla SunLife Insurance, and Meru Investment fund.