Anondita Medicare NSE SME IPO review

•    The company is in the business of manufacturing and marketing of male condoms and off late entered in female condoms.
•    The company got converted in a public limited company in 2024, till then it was a proprietorship concern.
•    The company posed growth in its top and bottom lines for the reported periods.
•    The boosted bottom line from FY2024 raise eyebrows and in particular bumper profits reported for FY25 appears to be a window dressing for fetching fancy valuations.
•    Based on its recent financial data, the issue appears greedily priced.
•    Only well-informed/cash surplus investors may park moderate funds for medium term.

PREFACE:
The company is opening its IPO on August 22, 2025, but its RHP dated August 18, 2025 was made available only on August 19, 2025 on public domain. This delayed tactic appears to be a fishy game from the vested interest parties. FY25 profits appears to be a window dressing to fetch fancy valuations.

ABOUT COMPANY:
Anondita Medicare Ltd. (AML) is a manufacturer of male condoms with a variety of flavors, with its flagship product marketed and sold under the brand “COBRA”. It has an installed production capacity of nearly 562 million condoms per annum, as per certificate issued by JP Sood, Chartered Engineer, dated June 04, 2025. Further, to follow sustainable production practices, the company uses CNG as a clean, environmentally friendly manufacturing fuel for its manufacturing plant situated at D-001, Sector 80, Gautam Budh Nagar, Noida, Uttar Pradesh, 201301.

Further, as AML gained experience in the industry and having supplied products to various pharma companies for last many years, it decided to venture out in the market by launching own brand of condoms under the name of Cobra Condoms. Its new brand is 100% electronically tested showing attractive designs/pictures and has different flavors like Strawberry, Mint, Chocolate, Butterscotch, Coffee, Bubble-gum. 

It uses export quality packing material to uphold standards and industry requirement. Encouraged by demand and overwhelming responses from consumers it has also started the production of female condoms. In terms of manufacturing facilities, the company boasts a state-of-the-art plant located in Noida, Uttar Pradesh. Its manufacturing capability is supported by 11 existing manufacturing lines at the moment.

AML is committed to playing a crucial role in controlling this devastating disease and ensuring a healthier future for all. It is constantly working towards a world where everyone can play safe and live free from the threat of HIV/AIDS and unintended pregnancies. As of Jully 31, 2025, it had 280 employees on its payroll.

ISSUE DETAILS/CAPITAL HISTORY:
The company is coming out with its maiden book building route IPO of 4793000 equity shares of Rs. 10 each to mobilize Rs. 69.50 cr. at the upper cap. It has announced a price band of Rs. 137 – Rs. 145 per share. The issue opens for subscription on August 22, 2025, and will close on August 26, 2025. The minimum number of shares to be applied is for 2000 shares and in multiples of 1000 shares, thereafter. Post allotment, shares will be listed on NSE SME Emerge. The issue constitutes 26.50% of the post-IPO paid-up capital of the company. From the net proceeds of the IPO, it will utilize Rs. 6.00 cr. for capex on equipment and machinery, Rs. 35.00 cr. for working capital, and the rest for general corporate purposes. 

The IPO is solely lead managed by Narnolia Financial Services Ltd., while Maashitla Securities Pvt. Ltd., is the registrar to the issue. Mansi Share & Stock Broking Pvt. Ltd., is the market maker. The IPO is underwritten to the extent of 15.01% by Narnolia financial and 84.99% by Mansi Share & Stock.

After issuing initial equity shares at par value, the company has issued further equity shares at a fixed price of Rs. 74 per share between June 2024 – August 2024. It has also issued bonus shares in the ratio of 1 for 2 in August 2024. The average cost of acquisition of shares by the promoters is Rs. 5.00, and Rs. 6.67 per share. 

Post-IPO, company’s current paid-up equity capital of Rs. 13.29 cr. will stand enhanced to Rs. 18.09 cr. Based on the upper price band of the IPO, the company is looking for a market cap of Rs. 262.26 cr. 

FINANCIAL PERFORMANCE:
On the financial performance front, for the last two fiscals, on a consolidated basis, the company has (as a proprietorship concern) posted a total income/net profit of Rs. 36.14 cr. / Rs. 0.35 cr. (FY23), Rs. 46.56 cr. / Rs. 3.85 cr. (FY24), and as a public limited company it marked total income/net profit of Rs. 77.13 cr. / Rs. 16.42 cr. (FY25). The sudden boost in its bottom lines for FY24 raise eyebrows and concern over its sustainability going forward, and if we refer its FY25 net earnings, it posted bumper profits which appears to have been cooked up to fetch fancy valuations.

For the last fiscal, the company has reported an EPS of Rs. 14.04 and RoNW of 33.62%. The issue is priced at a P/BV of 5.09 based on its NAV of Rs. 28.49 as of March 31, 2025, but its post-IPO NAV data is missing from its offer documents.

If we attribute FY25 super earnings on post-IPO fully diluted equity capital, then the asking price is at a P/E of 15.97. Based on FY24 earnings, the P/E stands at 67.13. Thus, the issue appears greedily priced.

For the reported periods, the company has (based on its proprietorship basis) posted PAT margins of 0.97% (FY23), 8.28% (FY24), and (on consolidated basis) 21.32%, (FY25), and RoCE margins of 10.14%, 24.74%, 37.42%, respectively for the referred periods. 

DIVIDEND POLICY:
The company has not paid any dividends for any financial years. It will adopt a prudent dividend, based on its financial performance and future prospects.

COMPARISION WITH LISTED PEERS:
As per the offer document, the company has shown Cupid Ltd., as its listed peers. It is trading at a P/E of 93.9 (as of August 20, 2025). However, they are not truly comparable on an apple-to-apple basis. This comparison appears to be an eyewash.

MERCHANT BANKER’S TRACK RECORD:
This is the 22nd mandate Narnolia Financial in the last three fiscals including the ongoing one.  Out of the last 10 listings, 2 opened at discount, and the rest with premium ranging from 2.53% to 90.00% on the date of listing.