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Review By Dilip Davda on April 4, 2017
Panache Digilife Ltd (PDL) - (Formerly known as Vardhaman Technology Ltd.) is a one stop IT Hardware hub, specialized in manufacturing, distribution and servicing of high quality products. Since its inception in 2007 Panache Digilife has been a Technical Service Provider, over the years it picked up expertise in procuring, manufacturing and marketing White Boxes. In June 2000, PDL emerged to become one of the most respected and professional one stop computer system specialists. The company has 5 divisions: PC division, Education division, Telematics division, AV division, Industrial design. It has the vision to become a world class, competitive and profitable ICT Manufacturing, Distribution and Services Company.
To part finance its working capital and general corpus fund needs, the company is coming out with a maiden IPO of 1800000 equity share of Rs. 10 each via book building route with a price band of Rs. 75 -81 per share to mobilize Rs. 13.5 - 14.58 crore (based on lower and higher price bands). Issue opens for subscription on 11.04.17 and will close on 17.04.17. Minimum application is to be made for 1600 shares and in multiples thereon, thereafter. Issue is solely lead managed by Pantomath Capital Advisors Pvt Ltd. and Bigshare Services Pvt Ltd is the registrar to the issue. Post allotment, shares will be listed on NSE (SME) Emerge. It raised equity at par from inception till March 2009 and has issued bonus shares in the ratio of 13 for 1 in January 2017. Post issue its current paid up equity capital of Rs. 4.2 crore will stand enhanced to Rs. 6.0 crore.
On performance front, the company has posted turnover/net profits of Rs. 23.68 cr. / Rs. 0.34 cr. (FY13), Rs. 24.74 cr. / Rs. 0.43 cr. (FY14), Rs. 39.55 cr. / Rs. 0.99 cr. (FY15) and Rs. 49.73 cr. / Rs. 1.38 cr. (FY16). For the first nine months of the current fiscal, it has earned net profit of Rs. 1.44 cr. on a turnover of Rs. 32.38 cr. If we annualize the latest earnings and attribute it on the fully diluted equity post issue, then the asking price is at a P/E of around 23 to 25 (based on lower and higher price bands). On P/BV aspect the price is 5 times plus. As per prospectus, the company has listed Cerebra as its peers (although not strictly comparable) that is quoting at a P/E of 384 plus. As on 31.12.16, company’s trade receivables were 70.42 per cent of the total current assets that appears to be a major concern. For the last three fiscals trade receivables were at 56.09% (FY14), 64.39% (FY15) and 46.18% (FY16).
On merchant banker’s front, this is the 42nd mandate from its stable and past mandates have shown mixed trends. However, if we consider last 10 listings, they have given positive returns on the listing day.
Conclusion: While company has been performing well with rising top and bottom lines, its trade receivables too were surging that remains major concern. Risk savvy cash surplus investors may consider investment.
Review By Dilip Davda on April 4, 2017
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 detail fundamental and financial analysis of companies coming up with IPO 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 ).
The initial public offer (IPO) of Panache Digilife Ltd offers an early investment opportunity in Panache Digilife Ltd. A stock market investor can buy Panache Digilife IPO shares by applying in IPO before Panache Digilife Ltd shares get listed at the stock exchanges. An investor could invest in Panache Digilife IPO for short term listing gain or a long term.
Read the Panache Digilife IPO recommendations by the leading analyst and leading stock brokers.
Panache Digilife IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the Panache Digilife IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts in the above answer.
Our recommendation for Panache Digilife IPO is to subscribe for long term.
As per the analysis by our lead analyst Mr. Dilip Davda, we suggest you to subscribe for long term to the Panache Digilife IPO.
The Panache Digilife IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit Panache Digilife IPO allotment status to check.
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