Wakefit Innovations IPO opens: Price, GMP, brokerage view and companys financials

New Delhi: Bengaluru-based home and furnishing company Wakefit Innovations Limited is ready to hit the stock market. Wakefit IPO will open for public subscription from December 8 to 10. There is both excitement and caution in the market about the publis offer of the company.

Established in 2016, Wakefit started by selling its travel mattresses. Gradually it expanded into furniture, furnishing and home accessories. Today the company is considered India's leading D2C home solutions brand. Its products are sold on its website, retail stores and e-commerce sites like Amazon, Flipkart.

The company has five manufacturing plants — two in Bengaluru, two in Hosur and one in Sonipat, from where the country's supply network operates. By March 2024, the company's revenue had crossed Rs 1,000 crore.

The price band of the Wakefit IPO has been fixed at Rs 185-Rs 195 per share, which shows the company's valuation of around Rs 6,400 crore. According to the GMP, investors can expect that its listing may increase by about 18 percent. But instead of just being happy to see the initial premium, investors should also look at its basic financial situation and risks.

Wakefit IPO Allotment is expected on December 11, 2025

Initiation of refunds process to unsuccessful investors will start on December 12

The shares will be credited to the demat accounts of eligible shareholders on December 12

The stock will list on BSE and NSE with a tentative date December 15

Wakefit plans to raise a total of Rs 1,289 crore from the IPO, out of which Rs 377 crore from fresh shares and Rs 912 crore from selling shares by promoters and investors (OFS). After the IPO, the promoters' stake will come down from 43.7 percent to about 37 percent.

The company will use the money mainly for expansion and branding. It plans to spend a total of Rs 207 crore to open 117 new COCO stores, purchase machinery, pay store rent and license fees, and Rs 108 crore on advertising and marketing. The remaining amount will remain for general business needs.

The company has increased revenue at a CAGR of 25 percent in three years and also recorded PAT i.e. net profit for the first time this year after being EBITDA positive in FY24. Despite this, its EV/sales multiple is being seen at 4.7 times, which is considered costlier than the listed peers. For this reason, many research houses, including SBI Securities, have given it a rating of AVOID and advised to watch its performance for the time being.

Reports say that the financial performance of the company is improving, but the valuation seems to be relatively high. Also, excessive dependence on mattresses, the risk of raw material prices and the pressure of competition can affect growth in the long run. Therefore, experts believe that instead of entering the IPO, it would be safer to take a decision after seeing the listing and performance of the company.

According to SBI Securities, although the brand has grown rapidly, a large part of its earnings is still dependent on one category, which is 'mattress'. Approximately 60 percent of the total revenue comes from it. In such a situation, any decrease in demand, pressure from new brands or changes in consumer choice can become a challenge for Wakefit.

The second risk is dependence on raw material prices. The company buys wood, chemical, fabric and metal products but does not enter into long-term supply contracts. Also, 26 to 38 percent of the content comes from overseas, which includes the US, China and Singapore. If supplies from these countries are interrupted or prices rise, then there may be pressure on margins.