Found some analysis by septa sir on other forum: Firstly one need to understand this is not IT company it is more a embedded manufacturing & mechanical Service company so comparing it with other company is wrong it does more work in ER&D field. the PE of the LTT stands at 26.79 a share. This is against a PE of 37.8 for Tata Elxsi and 14.7 for Cyient. So just looking at PE Cyient Looks cheap however one needs to understand RONW LTT is around 38% Cyient is only 17%. So if all thing equals LTT fair value is around Rs 1050 Per share based on RONW and another 10% given competitive advantage LTT has over Cyient so Fair value is Rs 1155 With 25% MIS is around Rs 870 Very close to issue price
Now let do the same analysis based of Tata Elxsi as we Know LTT RONW is around 38% and Tata Elxsi have superior RONW around 41% so doing the same calculation LTT fair price will be Rs1204 based on Tata Elxsi CMP with 25% MIS is around Rs 905
So average price based on this The fair Price with 25% Margin of safety would be Rs 888
So upside all depends how the market will value this at Rs 1200 or Rs 870
So L&T has again like it earlier IPO L&T finance and L&T Info have priced it right market however thought they should have left on table and L&T management would say they have if you look at Tata Elxsi however if CYient they have not let anything
The big question would i apply the answer is YES because the difference between loss is not much around 5% to 10% which is alright when upside is more like 30% to 40% so in short apply but listing may not be great
ALSO VERY IMPORTANT MANY IPO INVESTOR WILL SEE THIS AS A NORMAL IT COMPANY AND NOT TAKE MUCH INTEREST FROM HNI WHICH COULD HAVE NEGATIVE EFFECT ON LIST END OF THE IT ALL SUPPY AND DEMAND
Jai Jinendra....Jai Shree Ram
Zerodha (Trading & Demat Account)
RHP
IPO Mentor (500+ Posts, 400+ Likes)
