GMP, Subscription, Key Risks, Other Details; Should you Invest?

DreamFolks Services IPO Day 2: DreamFolks Services IPO was fully subscribed within hours of opening for the subscription. The Rs 562 crore initial public offering (IPO) of DreamFolks Services opened for subscription on August 24, Wednesday. The issue is open for subscription till August 26 (Friday). DreamFolks facilitates an enhanced airport experience for passengers, leveraging its technology-driven platform and facilitates consumers’ access to airport-related services like lounges, food and beverages, spa, meet and assist airport transfer, transit hotels, or nap room access, and baggage transfer services.

DreamFolks Services IPO: Subscription Status

After day one of bidding, DreamFolks IPO subscription status informs that the public issue has been subscribed 1.96 times whereas its retail portion has been subscribed 7.93 times.

DreamFolks Services IPO: IPO Details

Investors can make a bid of a minimum of 46 equity shares and in multiples of 46 equity shares thereafter. The public issue is proposed for listing on both NSE and BSE and the tentative DreamFolks IPO listing date is September 6, 2022.

The issue is entirely an offer for sale (OFS) of up to 1,72,42,368 equity shares with a face value of Rs 2 each by its promoters Liberatha Peter Kallat, Mukesh Yadav and Dinesh Nagpal.

DreamFolks Services IPO: Key Risks

Choice Broking in its IPO note listed a few risk factors that might affect the business. The first is unfavorable government policies and regulations.
It also said that the sluggish expansion in the airport network and lower lounge access is not positive for the business.

Further, difficulty in expanding global operations, revenue concentration risk, difficulty in continuing relations with the card network and lounge operators, and competition from peers are things that the company needs to watch out for.

DreamFolks Services IPO: Strength

“According to the F&S Report, DreamFolks is dominating the market with a share of over 95 per cent in FY22 of all India-issued card-based access to domestic lounges. The company boasts 50 clients including card networks and major card issuers and 9.8mn end customers availed its services, since FY20. It is also a strong player in the industry with a share of over 80 per cent in the domestic lounge access market in India,” Reliance Securities said.

DreamFolks Services IPO: GMP Today

As per the market observers, shares of DreamFolks Services Ltd are available at a premium of Rs 83 in grey market today. DreamFolks IPO grey market premium (GMP) surged from Rs 60 to Rs 83 in just one day. They said that for last two days, secondary market mood has remained positive and it has influenced the grey market as well. However, the most dominating reason for sharp upside move in Dreamfolks IPO GMP today is strong response by the retail investors on day one. They said that the grey market premium may further rise as market mood is expected to remain positive in near term.

DreamFolks Services IPO: Should you Subscribe?

Giving ‘subscribe’ tag to the public issue, Reliance Securities says, “DreamFolks Services Ltd has a strong business revenue potential over next decade on the back of a) Healthy air traffic growth, b) Increasing issuance of credit cards and c) Better awareness of usage of cards for lounges and higher penetration from current low level of 5 per cent. In view of strong business moat, healthy recovery in Air Passenger traffic, increase Lounge services, multi-fold revenue growth potential, unique asset-light and efficient business model, we recommend SUBSCRIBE to the issue.”

The views and investment tips by experts in this News18.com report are their own and not those of the website or its management. Users are advised to check with certified experts before taking any investment decisions.

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