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Review By Dilip Davda on September 12, 2017
Shree Tirupati Balaji FIBC Ltd. (STBF) is engaged in manufacturing and supply of High Density Polyethylene (HDPE) / Polypropylene (PP) woven sacks, Flexible Intermediate Bulk Container (FIBC). Its manufacturing unit is situated at SEZ area located at Pithampur, Dist. Dhar, MP. Majority of its sales are from exports to countries like USA, UK, Australia, Germany, Italy, Spain, New Zealand etc.
To part finance its working capital and general corpus fund needs, STBF is coming out with a maiden IPO of 2700000 equity share of Rs. 10 each via book building route with a price band of Rs. 36-40 to mobilize Rs. 9.72 to Rs. 10.80 crore (based on lower and upper price bands). Issue opens for subscription on 21.09.17 and will close on 26.09.17. Minimum application is to be made for 3000 shares and in multiples thereon, thereafter. Post allotment, shares will be listed on NSE SME Emerge. Issue constitutes 26.65% of the fully diluted paid up equity capital of the company post issue. BRLMs to this offer are Pantomath Capital Advisors Pvt. Ltd. and SIDBI (Small Industries Development Bank of India). Bigshare Services Pvt. Ltd. is the registrar to the issue. Having issued initial equity at par, it raised further equity in a price range of Rs. 80 to Rs. 113 between July 2010 and March 2013. It has also issued bonus shares in the ratio of 11 shares for every 1 share held in July 2017. Post issue, STBF’s current paid up equity capital of Rs. 7.43 crore will stand enhanced to Rs. 10.13 crore.
On performance front, STBF has posted turnover/net profits of Rs. 40.43 cr. / Rs. 2.24 cr. (FY14), Rs. 54.13 cr. / Rs. 2.44 cr. (FY15), Rs. 62.09 cr. / Rs. 3.38 cr. (FY16) and Rs. 69.80 cr. / Rs. 2.87 cr. (FY17). There has been inconsistency in PBT for last four fiscals. If we attribute latest earnings on fully diluted equity post issue then asking price is at a P/E of around 14 plus (on the upper price band - against peers P/E ranging from 11 to 33). For last three fiscals, its average EPS is Rs. 4.00 (on pre-bonus equity) and average RoNW is 19.60%. Issue is priced at a P/BV of 1.7. Thus issue is priced reasonably.
On merchant banker’s front, this is the 46th mandate from Pantomath in last three years. Out of last 10 recent listings, 1 opened at discount, 1 at par and the rest with 1 to 18% premium on IPO price. This is the 2nd mandate from SIDBI and the last listing in 2015 opened with 10% plus premium on the date of listing.
Conclusion: Investment may be considered from medium to long term.
Review By Dilip Davda on September 12, 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 Shree Tirupati Balajee FIBC Ltd offers an early investment opportunity in Shree Tirupati Balajee FIBC Ltd. A stock market investor can buy Shree Tirupati IPO shares by applying in IPO before Shree Tirupati Balajee FIBC Ltd shares get listed at the stock exchanges. An investor could invest in Shree Tirupati IPO for short term listing gain or a long term.
Read the Shree Tirupati IPO recommendations by the leading analyst and leading stock brokers.
Shree Tirupati IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the Shree Tirupati IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts in the above answer.
Our recommendation for Shree Tirupati IPO is to subscribe.
As per the analysis by our lead analyst Mr. Dilip Davda, we suggest you to subscribe to the Shree Tirupati IPO.
The Shree Tirupati IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit Shree Tirupati IPO allotment status to check.
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