Precision Camshafts Ltd IPO Message Board (Page 47)

Gmp price in ahemedabad for pcl and team lease and prag food

HOS:
Healthcare Global and Parag Milk .. have cancelled/deferred their IPO.
Teamlease IPO continue as scheduled .. opening on 02nd Feb

this will have adverse impact on PCL issue bcoz sentimental is very important next week if market falls then risk get higher this could list in discount

As per info I have...none of these IPO''s are cancelled...they are getting sequenced for a diff time given Indian market volatility, Chinese New Year, budget anxiety in markets, etc

New Issues Analysis(IPO) - Precision Camshafts

By Geetanjali Kedia

Precision Camshafts is entering the primary market on Wednesday 27th January 2016, to raise Rs. 240 crore, via a fresh issue of equity shares of Rs. 10 each and an offer for sale of up to 91.5 lakh equity shares, by promoters and directors, both in the price band of Rs. 180 to Rs. 186 per share. The total fund raising aggregates to Rs. 410 crore, at the upper end of the price band, of which, offer for sale portion is Rs. 170 crore. Representing 23.28% and 23.62% of the post issue paid-up capital, at the upper and lower end respectively, the issue will close on Friday 29th January.

Precision makes camshafts, mainly for passenger vehicles, as also, for tractors, light commercial vehicles and locomotive engines, having 2 manufacturing facilities in Solapur, Maharashtra, with aggregate annual capacity (30-9-15) of 13.38 million camshaft 78% of FY15 revenues), while 2 customers alone, Ford and General Motors, made up for 71% of FY15 revenues, indicating huge customer concentration, a risk factor which has haunted a couple of auto component players lately.

Company is undertaking Rs. 200 crore capex for a new machine shop, for ductile iron camshaft at Solapur (export unit), with capacity of 0.96 million tons per annum, to be funded via fresh issue proceeds. In the offer for sale, 2 promoters (Shah), a promoter group company (Cams Technology) and a company director (Jayant Aradhye) will off-equity shares.

Since significant turnover is through export sales, rupee depreciation since FY14 has helped company improve margins (although Rs. 50 crore ESOPs charge in FY14 dented margins a little for that year). FY15 consolidated revenue stood at Rs. 561 crore, on sales volumes of 10.11 million units, and EBITDA was at Rs. 151 crore. Net profit came in at Rs. 62 crore, resulting in an EPS of Rs. 7.62, on high equity of Rs. 81.84 crore. H1FY16 was quite flat, in terms of growth, with revenue and net profit of Rs. 271 crore and Rs. 34 crore respectively, translating into an EPS of Rs. 4.16 for the first half.

Annualising H1FY16 EPS, expected earnings for FY16 may be at Rs. 8.50 per share, which discounts the upper end of the price band of Rs. 186 by a PE multiple of about 22 times (pre money). On FY17 estimates, after accounting for the dilution (post money), PE multiple remains upward of 22x, which is very expensive for an auto component maker, with single product profile and regional manufacturing capabilities. Comparable peers are ruling at PE multiples in low-to-mid teens. On a topline of Rs. 550 crore, company is seeking market cap of Rs. 1,760 crore and an enterprise value of Rs. 1,870 crore, which is extremely rich and unconvincing.

As of 30th September 2015, company’s net worth stood at Rs. 269 crore. It had total debt of Rs. 212 crore and cash and equivalents of Rs. 102 crore, leading to net debt of Rs. 110 crore. Promoter holding of 81.51% will shrink to 63.60% post IPO.

Tata Capital had invested in the company, holding equity since the year 2008. Cams Technology Limited, a company whose 100% equity is owned by promoters, was incorporated in June 2013. On 17th August 2013, Precision Camshafts subscribed to preference shares of Cams Technology worth Rs. 62 crore. Also, in August 2013 itself, 80,394 equity shares of Rs. 100 each held by Tata Capital in Precision Camshafts were acquired by Cams for Rs. 62 crore! Thus, to give exit to the PE investor, company structured the transaction, by creating a new entity / group company and avoid buy-back of its own equity shares. Was this done since Tata Capital couldn’t find a buyer for its 5 year old investment?

Rs. 62 crore in August 2013 is a valuable resource at the company’s disposal, given company’s net worth of Rs. 110 crore and net debt of Rs. 153 crore, as of 31-3-13. Now, Cams Technology is one of the selling shareholders in the ensuing offer for sale. On effective cost of acquisition of Rs. 38.56 per share, it is now expecting sale price of Rs. 186 per share (i.e. 4.8x in 30 months!), which is not justified by the financials.

Such unusual structuring to facilitate PE exit does not bode well, in terms of corporate governance, which may not be illegal on the face of it, but may not get pardoned by the market, as well. In essence, a group company, in which promoters own 100% equity (just Rs. 50 lakh), while preference share capital (of Rs. 62 crore) subscribed to by the company, is used as a structuring vehicle. Company has essentially used its own funds to buy shares from the PE investor and, in spirit, is holding its own equity!

To conclude, corporate governance seems to be an issue with this company, coupled with valuations being extremely expensive. In addition, auto industry, and auto components sector in particular, is not currently in ‘flavor’ so as to get away with premium valuations. To top it all, current secondary market conditions are definitely not conducive, which are giving many players in auto ancillary segments at much cheaper valuations in the secondary market. Thus, nothing in the issue seems to be going in its favour, making it a clear avoid.

Disclosure: No interest.
Source: https://www.sptulsian.com/article/87097/precision-camshafts

TEAMLEASE SERVICES PRIVATE LTD
CRISIL GRADE 4/5
ISSUE OPEN 2ND FEB
ISSUE CLOSE 4TH FEB
ISSUE SIZE 450 CR
QIB 75%
NII 15%
RIIS 10%
PRICE BAND TO BE ANNOUNCED

annualised profit is just 20 cr service industry even with high PE 30 which IMO is to much MC should be not more then 600 Cr but this issue itself is 450 so MC will be 2000 cr Avoid

Parag IPO
HOS: Retail Discount will be there.

eagleye this would have reduce the premium on PCL what is present rate more buyers or sellers

Source?
I think Parag ipo is on 4th.

73% of application in previous IPOs were applied through cheque.
So you may see a dent in subscription figure in upcoming IPOs.

PCL GMPs 12.5-14
Application 500
Not much activity.

I am sure that subscription will not be more than 1.5X in any case.
Brokers here in Rajkot & Bhavnagar not buying application & will not apply as they want cheque system to start again.



No worry for allotment those using ASBA.

Eagleye,
Will application amounting Rs. 2lac applicable?

FOR THE BENEFIT OF ALL

FAQs on ASBA for Investors (Source: http://www.sebi.gov.in/faq/asbaprocess.html)

1.      What is “ASBA”?
ASBA means “Application Supported by Blocked amount”. ASBA is an application containing an authorization to block the application money in the bank account, for subscribing to an issue. If an investor is applying through ASBA, his application money shall be debited from the bank account only if his/her application is the registrars.

2.      Who can apply through ASBA process?
An individual investor can apply through ASBA process in a public issue through book building route provided he/ she:
a.      is a “Resident Retail Individual Investor” i.e. applying for shares/ securities up to Rs.1,00,000/-
b.      is bidding at cut-off, with single option as to the number of shares bid for
c.      is applying through blocking of funds in a bank account with the SCSB
d.      has agreed not to revise his/her bid
e.      is not bidding under any of the reserved categories.

SEBI has permitted ASBA process in rights issue on pilot basis. All shareholders of the company as on record date are permitted to ASBA for making applications in rights issue provided he/she/it:
a.      is holding shares in dematerialised form and has applied for entitlements or additional shares in the issue in dematerialised form
b.      has not renounced its entitlements in full or in part
c.      is not a renouncee to the Issue
d.      applies through a bank account maintained with SCSBs.

3.      What advantage an investor has in applying through ASBA vis-à-vis applying through an application with a cheque?
Applying through ASBA process has the following advantages:
(i)      The investor need not pay the application money by cheque rather the investor submits ASBA which accompanies an authorization to block the bank account to the extent of the application money.
(ii)      The investor does not have to bother about refunds, as in ASBA only that much money which is required for allotment of securities, is taken from the bank account only when his application is selected for allotment after the basis of allotment is finalized.
(iii)      The investor continues to earn interest on the application money as the same remains in the bank account. The application form is simpler.
(iv)      The investor deals with the known intermediary i.e. its own bank.

4.      Is it mandatory for investors eligible for ASBA, to apply through ASBA only?
No, it is not mandatory. An investor, who is eligible for ASBA, has the option of making application through ASBA or through the existing process of applying with cheque.

5.      Can I make application through ASBA process in all issues?
No, you cannot make application through ASBA process in all issues. ASBA is applicable to only book-built public issues which provide for a uniform payment option to the retail individual investors. On pilot basis, SEBI has enabled ASBA in few selected rights issues.

6.      Where should I submit my Application Supported by Blocked Amount (ASBA)? How shall I know which bank and which branch of that bank is the designated branch for accepting ASBA applications?
List of Self Certified Syndicate Banks (SCSBs)”) and their designed branches i.e branches where ASBA application form can be submitted, is available in website of BSE (www.bseindia.com ) and NSE (www.nseindia.com ) and in website of SEBI (www.sebi.gov.in ).The same would also be given in the ASBA application form.

7.      What is Self certified Syndicate Bank (SCSB)?
SCSB is a bank which is recognized as a bank capable of providing ASBA services to investors. Names of such banks would appear in the list available in website of SEBI. Also see answer to question (6)

8.      Can I submit ASBA in any of the banks specified in the list of SCSBs?
No, ASBA can be submitted to the SCSB with whom the bank account authorised to be blocked, is maintained.

9.      Am I required to submit ASBA only physically?
No, you can either fill up the physical ASBA form available with SCSB and submit the same to the SCSB or apply electronically through the internet banking facility (if provided by SCSB).

10.      Can I the existing application form for public issues for applying through ASBA?
Investor is requested to check the form carefully. In case of public issue, the application form for ASBA will be different from the existing application form for public issues. The application forms will be available with designated branches of SCSB. In case of rights issue, there will not be a separate form for ASBA. The investor has to apply by selecting ASBA option in Part A of the Composite Application Form.

11.      Can I withdraw my ASBA bids? If yes, how?
Yes, you can withdraw ASBA bids. During the bidding period you can approach the same bank to which you had submitted the ASBA and request for withdrawal through a duly signed letter citing your application number, TRS number, if any.

After the bid closure period, you may send your withdrawal request to the Registrars, who will cancel your bid and instruct SCSB to unblock the application money in the bank account after the finalization of basis of allotment.

12.      Who should I approach if I find that I had given all correct details in the ASBA form, but application has been rejected stating wrong data?
You have to approach the concerned SCSB for any complaints regarding your ASBA applications. SCSB is required to give reply to you within 15 days. In case, you are not satisfied, you may write to SEBI thereafter at the following address:
Investor Grievance Cell, Office of Investor Assistance and Education,
Securities and Exchange Board of India
Plot No.C4-A,''G'' Block, Bandra Kurla Complex,
Bandra(East), Mumbai: 400051
Tel: +91-22-26449000 / 40459000
Fax : +91-22-26449016-20 / 40459016-20

13.      Whether my bank account will be blocked or only the amount to the extent of application money is blocked?
No. the entire bank account will not be blocked. Only the amount to the extent of application money authorized in the ASBA will be blocked in the bank account. The balance money, if any, in the account can still be used for other purposes.

14.      If I withdraw my bid made through ASBA, will the bank account be unblocked immediately?
If the withdrawal is made during the bidding period, the SCSB the Registrar, which is after the finalization of basis of allotment in the issue.

15.      Do I necessarily need to have a DP account with the SCSB where I intend to submit the ASBA application?
No. Investors need not necessarily have their DP account with the SCSB, where they are submitting the ASBA form.

16.      Can I submit my ASBA to a broker as is being done in the present issue process applying through cheque?
You are required to submit ASBA to the SCSBs only.

17.      Can I apply in an issue through “ASBA” process and through “normal existing system of payment through cheque” in an issue?
No. An investor can apply either through ASBA or through existing system of payment through cheque. If an applicant applies through both ASBA as well as non ASBA then both the applications having the same PAN, will be treated as multiple application and hence rejected.

18.      Will I get an acknowledgement for submission of ASBA applications?
Yes. The Self Certified Syndicate Bank (SCSB) are required to give the acknowledgement for submission of ASBA application form.

19.      Are the bids submitted through ASBA and uploaded in the electronic bidding system of the stock exchange, in case of public issue through book building, reflect in the demand graphs displayed in the website of stock exchanges?
Yes. The bids received through ASBA mode will also be reflected in the demand graphs displayed in the website of stock exchanges.

20.      Who is responsible for errors in the data uploaded in the electronic bidding system in case of public issue?
In case there is an error by the investor in entering the data in the application form, the investor shall be responsible. In case there is an error by SCSB in entering the data in the electronic bidding system of the stock exchanges, the SCSB shall be responsible.

21.      Will I get the acknowledgement of receipt for applications submitted through ASBA from the SCSB?
Yes. The SCSB shall give a counterfoil as an acknowledgement at the time of submission of ASBA and also the order number, generated at the time of uploading the application details, if sought by the investors in case of need.

22.      Will there be any different treatment in allotment for ASBA and Non-ASBA forms?
No. ASBA forms will be treated similar to the non-ASBA forms while finalizing the basis of allotment.

23.      What happens when the issue fails/ is withdrawn?
In case the issue fails/withdrawn the SCSB shall unblock the application money from the bank accounts upon receiving instructions from the Registrar.

24.      In case of any complaints regarding ASBA application whom can I approach?
In case of any complaints the investor shall approach the bank, where the application form was submitted or the Registrars to the issue.

pls put down these events for next fortnight
23-jan davos meeting end.
28-jan FED be announced policy(US)
29-jan boj will be declare policy(Japan)
29-jan budget value(India)
02-feb RBI will be declare policy(India)
08-feb GDP data(India)

Hi Folks,
I always benefit from your comments in this forum.
I get DCF Valuation at Rs 182 per share with following assumptions:
1.Sales Growth:- 10% growth rate for FY17,FY18 followed by 3 yrs at 15%, followed by return to 10% for next 3 yrs.
2.Terminal Perpetuity Growth Rate @4.5%
3.CapEx taken at 668 Millions i.e. average of last 4 years plus 1200 Millions each for FY17 & FY18.
4.EBITDA Margin kept same as achieved in FY15 with a small 10 bps growth yoy.
5.D&A kept @17% same as seen for FY15.
6.WC assumed to grow in sync with Sales.
Please let me know your thoughts.... esp about the Sales Growth assumption...do u think it''s too optimistic? reasonable?

Thanks. I am not CA. An engineer & MBS , worked in most industries and also done M&As large corporation.

However good the DCF, IRR, if corporate governance is a suspect, suggest keep away. Numerous examples like Amtek, Suzlon, Opto Circuit, Ahmednangar forgings... have shown that a good business, good value can get eroded in no time to the shareholder. My take on PCL is in bull market, I will take chance . In this market, I have choices to pick well Governed scrip which can even be a multi bagger...

Agreed... There is a big ''execution risk'' as well as corporate governance issue. There is no ''margin of safety'' afforded by the offer price. Shareholder''s value could erode very quickly in case they fail to the planned projects properly. The risk is further compounded by the fact that they are export-oriented & their growth correlates strongly with global growth. The assumptions of vigorous growth of 10%-15% is already a stretch given estimates of 4.5% CAGR for Global Camshaft sector.

The IRR implied in the price of 180 is indeed very low.. just 10.5%. The cost of debt is taken 5.75% given low interest rate foreign currency loans. The resulting WACC was 9%. I would have been ok if IRR was at least 12%...but that would require a price of c.150!

I''m still uncertain as to whether to invest or not....

Corporate governance is a big question for this company. Promotors salary increase before ipo is questionable. Tremendous increase in last year''s net profit is also in question. If I think as an analyst big question is growth for next years. Company is capable to maintain same growth as 2014-2015 for coming years?

Though there are many if and then but I am going to apply for 2 minimum applications. Secondary market is also good for selected scripts.

One noticeable thing in recent ipo''s is that whenever there is an ofs included, issue gets listed at reasonable premium like in NH, indigo, but that doesn''t mean to apply blindly, right now it''s wait & watch

PCL GMP 12.50 - 14.00 per share

let me make one thing clear I am applying for this issue...... however this could list on discount like shree pushkar and then fly.... when i compared it with indigo i meant in regards with corporate governance and market does not like that was one main reason the issue was not over subscribed and even on HNI it was not overly over subscribed. in case of indigo... same with PCL it good on price offer and growth prospects it is bad and ugly on shah take the lion share.....

plus this issue has left a lot on table compare to some issue in 2015

So if i have confused anyone sorry and i am applying

PCL 13-14
Application 550 @Rajkot

MY MAXIMUM PROFIT OF YEAR WAS SHORTING INDIGO SHARE , THAN BUYING AND SELLING ,
BUT DONOT EVERY TRY IT FOR OTHER SHARES YOU WILL BE IN TRAP AS YOU ARE NOT AWARE WHAT IS GOING ON

1. When Indigo IPO was anounced, there was not much interest but when it started upmove, everyone shouting INDIGO...INDIGO....Even I don''t know about sharemarket much and I made Rs 10000 taking advantage of price changes.

Now, thinking I can make some more money after result, I bought 65 shares at 1201. Now its around 960. Loss 16,000. What is the of this?

2. Lessons learnt: In sharemarket you can make moneyAND AFTER SOME TIME you loose it TWO TIMES or even more....

3. Who is BIG BULL that everyone is talking about? Is it Rakes?

WARING OF INDIGO WAS GIVEN IN ADVACE , BUT YOU DID NOT UNDERSTAND ,I CANNOT DIRECTLY WRITE , ANY THING , SO I TRY TO BLAME SOME OR THE OTHER BROKERS , ANY WAY YOU ARE IN LOSS OF RS 6000 , CANNOT ADVICE YOU FURTHER , TACTIS OF TRADE ,OF INDIGO AS CHANGES FROM TIME TO TIME

Yes, in this type of flying stocks, things turn upside down at any time. One example is Yes Bank. But the traders are sometimes lured to go positive as they continue seeing up trends. Finally at one other time, their tactics become wrong. This was unexpected disaster. Airlines used to fly high instead of market fall. Results were expected good since ATF fuel prices were going down. Thinking this will come up after results....many people @loss.

1. Does anyone know how far it will go down still? Rs 800, 700, or more down? chemcho/Staripoor any other experienced people can you help?

2. Precision camshft...subscribe or not to? Nasirul, septa, chem, Staripo,

OIL HAS REACHED TO 32 $ PER BARELL , SEEMS MARKETS HAVE STABILISED BECAGOLD IS DOWN

Rs 800 is the averaging price?

2day FII were net sellers then also nifty moved up by 140 points. Any answers?

take a look at the F&O open interest numbers

yes they r buying in F&O

Parag Milk Dairy IPO Likely to come on 4th Feb

Heard that L&T Infotech IPO also will be in 2nd week of February ... is that true ?

Parag milk ipo details will come om Mondat Confirm

L&T Info Ipo & HCG ipo likely to come on 2nd week February.
I will confirm once i get information from genuine sources.

Septa
Your views in PCL looks vague
Sometimes you compare this with INDIGO on otherside to ask to avoid as such will give discount listing.

Please keep one stand on PCL.
Also please post ipo message
This forum is for IPO.
Many are not interested in secondary market.

Please provide clear view

Arjun,if u don''t interested in secondary mkt doesn''t mean many others also..only septa is providing accurate analysis of shares others are copy pasting....,primary or secondary no matter.....ipo listing always punished chor prmtr...

my investment r long term where i see big return some IPOs which listed at discount went on to multi bagger.....in fact majority majority of IPO applier apply for short term or listing gain so PCL IMO could list at discount but long run if the company delivers result it will be a big wealth creator.....many of the darling today and wealth creator listed at discount.....

With PCL i am applying at will buy on listing also if it is not over subscribed i will apply in full strength which i had made clear in my easier posts.

Arjun Ji sorry if i confused u.