Courtesy: https://www.chittorgarh.com/
Review By Dilip Davda on August 8, 2025
- This is the 3rd RI from the company since September 2021.
• PHRL is engaged in the business of retail trading in home furniture and fashion materials.
• It marked de-growth in its top lines for the reported periods.
• The company posted losses for the last two fiscals and thus the issue is priced aggressively at a negative P/E.
• There is no harm in skipping this pricey and “High Risk/Low Return” bet.
PREFACE:
This company has a big surprise in store as it has fixed a record date of March 20, 2025, and throwing open its RI on August 07, 2025. Its offer document is dated Jully 30, 2025. This inordinate delay is better known to merchant bankers and the company. They must clarify on this lacuna to the investors as it is missing transparency.
ABOUT COMPANY:
Praxis Home Retail Ltd. (PHRL) operates brick and mortar stores of home furniture and home fashion in the brand name of HomeTown and caters to home retail segment in India. This retail format brings together under one roof, a wide range of furniture (both office and home furniture), home furnishing goods, kitchenware, other home related accessories and quality services including complete home design, modular kitchen among others, giving customers a great in-store experience. In addition, an exciting range of accessories, such as clocks, wall hangings and décor make it a complete one stop shop for all home needs. As of June 30, 2025, HomeTown has a pan India presence with 16 stores, across 14 cities in India. The Company also operates a web portal for online sale of products through the website www.hometown.in and also has its presence on the major e-commerce market places in India through which it sells a wide range of products across furniture, furnishings, décor, tableware and kitchenware.
Driven by the wide scale of operation and an experienced management team, its business reflects robust sourcing capabilities across categories of portfolio. In addition, HomeTown maintains an extensive supplier network, both in local and foreign markets. With a wide vendor network, HomeTown ensures best quality products for entire product portfolio. HomeTown works with different vendors across India to source furniture and home furnishing products. In addition, it has put in place effective quality control measures, by a centralized quality control team. Furniture, Stock Keeping Units (SKUs) are approved post a comprehensive quality screening process wherein sample for each SKU is sent to quality control team pre-dispatch. HomeTown has an experienced team which has expertise in both domestic and international sourcing. Its dedicated quality assurance team in Malaysia and China (major sourcing hubs) also helps in accelerating the new product development.
PHRL’s online direct to customer sales are made though e-commerce portal www.hometown.in. The company has been operating this website and have established a sizeable foothold in the online furniture space. Its e-commerce website www.hometown.in is developed using the modern technologies and is maintained and supported by an efficient team of engineers and technicians. The company provides a very unique feature of ‘Live video’ demonstration, through which a consumer can complete their shopping from the comfort of their homes. Once a customer avails this option, a sales person through video call will give a live demonstration of the products thus aiding the customers in making the buying decision. It provides an omni-channel experience to customer, by virtue of which when a customer walks to a store and selects some products, it gets added to customer’s cart on HomeTown.in. Thereafter the customers can go back to their home, show the products to the family members and then make eventual purchase. The company also sells products through major e-commerce market places in India. It has optimized supply chain for faster delivery for both its e-commerce and physical store operations. In addition to faster deliveries, PHRL has capability to get the product assembled within 24-48 hrs of delivery thus leading to customer delight. As of June 30, 2025, it had 359 employees on its payroll and additional 37 contractual employees at various locations.
ISSUE DETAILS:
The company is coming out with its Rights Issue (RI) of 49580000 equity shares of Rs. 5.00 each at a fixed price of Rs. 10.00 per share to mobilize Rs. 49.58 cr. The RI has opened for subscription on August 07, 2025, and will close on August 18, 2025. The company is offering RI in the ratio of 11 for 30 to its eligible stakeholders as of the record date of March 30, 2025. It is a big surprise that the company that has record date of March 30,2025, it floating its RI in the month of August 2025. The reason behind such extra-ordinary delay is better known to the merchant bankers and the company, and they need to throw some light on this.
The company is asking for full money on application for number of shares applied. Post allotment, shares will be listed on BSE and NSE. The company is spending Rs. 1.05 cr. for this RI process, and from the net proceeds, it will utilize Rs. 10.00 cr. for repayment of part of its borrowings, Rs. 28.00 cr. for repayment of outstanding trade payables, and Rs. 10.53 cr. for general corporate purposes.
The RI is jointly lead managed by Prime Securities Ltd., and New Berry Capital Pvt. Ltd., while MUFG Intime India Pvt. Ltd. is the registrar to the issue.
Post RI, company’s current paid-up equity capital of Rs. 67.67 cr. will stand enhanced to Rs. 92.46 cr. Based on the RI pricing, the company is looking for a market cap of Rs. 184.92 cr.
FINANCIAL PERFORMANCE:
On the financial performance front, for the last two fiscals, it has posted a total income/ net profit, of Rs. 225.94 cr. / Rs. – (85.71) cr. (FY24), Rs. 158.12 cr. / Rs. – (34.98) cr. (FY25).
DIVIDEND POLICY:
The offer document is silent on its dividend policy. The company has not declared any dividends for the reported periods of the offer document. It will adopt a prudent dividend policy, based on its financial performance and future prospects.
SCRIP PERFORMANCE: BASED ON BSE WEBSITE DATA: SCRIP CODE: 540901 (FV Rs. 5).
The scrip last closed on cum-right basis at Rs. 11.99 on March 19, 2025, 2025, and opened on an ex-right basis at Rs. 10.89 on March 20, 2025, 2025. Since then, it has marked a high/low of Rs. 11.83 / Rs. 8.60. The scrip last closed at Rs. 10.05 as of August 08, 2025. For the last 52 weeks’ it has posted a high/low of Rs. 258.43 / Rs. 128.38. The counter is currently under ESM: Stage 1.
The promoters’ holding has declined to 9.92% as of quarter ended June 30, 2025, against 26.26% as of quarter ended December 31, 2024. The counter is currently trading just above RI price to tempt investors.
Conclusion / Investment Strategy
This is the 3rd RI from PHRL since September 2021. The company is engaged in the business of retail trading in home furniture and fashion materials. It marked de-growth in its top lines for the reported periods. The company posted losses for the last two fiscals and thus the issue is priced aggressively at a negative P/E. There is no harm in skipping this pricey and “High Risk/Low Return” bet.
Review By Dilip Davda on August 8, 2025
Review Author
DISCLAIMER: No financial information whatsoever published anywhere here should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is purely for educational and information purposes only and under no circumstances should be used for making investment decisions. My reviews do not cover GMP market and operators game plans. Readers must consult a qualified financial advisor before making any actual investment decisions, based the on information published here. With entry barriers, SEBI wants only well-informed investors to participate in such offers. With crazy listings in the recent past, SME IPOs drew the attention of investors across the board and lead to seer madness. However, as SME issues have entry barriers and continued low preference from the broking community, any reader taking decisions based on any information published here does so entirely at their own risk. The above information is based on information available as of date coupled with market perceptions. The Author has no plans to invest in this offer.
About Dilip Davda
Dilip Davda is veteran journalist associated with stock market since 1978. He is contributing to print and electronic media on stock markets/insurance/finance since 1985.
Dilip Davda is a leading reviewer of public issues and NCDs in the primary stock market in India. The knowledge he gained over 3 decades while working in the stock market and a strong relationship with popular lead managers makes his reviews unique. His detailed fundamental and financial analysis of companies coming up with IPOs helps investors in the primary stock market. Dilip Davda has a special interest in analyzing the SME companies and writing reviews about their public issues. His reviews are regularly published online and in news papers.
(Dilip Davda -SEBI registered Research Analyst-Mumbai,
Registration no. INH000003127 (Perpetual)
Email id: dilip_davda@rediffmail.com ).
Courtesy: https://www.chittorgarh.com/
