B D Ind. BSE SME IPO review (May apply)

•    The company is currently engaged in manufacturing plastic components for automotive and industrial applications.
•    It is also trading in variety of plastic products needed by various sectors.
•    It marked static top lines for FY23 and FY24, but boosted profits from FY24 onwards raise eyebrows.
•    Based on its financial data, the issue appears aggressively priced.
•    Only well-informed/cash surplus investors may park moderate funds for long term.

ABOUT COMPANY:
B D Industries (Pune) Ltd. (BDIL) started its journey in 1984 with repairs and manufacturing of traction batteries. Thereafter it started making plastic container boxes for the same traction batteries using roto-moulding technology. Acquired Toyo containers (Partnership firm) in year 2010. After that BDIL began with the production of high-quality rotomolded battery boxes and water tanks. Over time, it has expanded capabilities to manufacture a wide range of plastic components for automotive and industrial applications, establishing itself as a leading player in the industry. Currently, it is engaged in the business of manufacturing and trading of Plastic Products for varied industries.

In the automotive sector, its key products include Plastic fuel tanks for off-road vehicles, urea tanks, fenders, hydraulic tanks, air ducts, mudguards, and cabin roofs. Beyond automotive, its rotomolded plastic products serve diverse industries, including road & highway safety, material handling & storage, water management & disposal, marine, renewable energy, healthcare, and custom moulding. With a commitment to innovation and quality, the company continues to deliver durable, high-performance solutions that meet the evolving needs of customers across various sectors. As of May 31, 2025, it had 98 employees on its payroll.

ISSUE DETAILS/CAPITAL HISTORY:
The company is coming out with its maiden book building route IPO of 4200000 equity shares to mobilize Rs. 45.36 cr. at the upper cap. It has announced a price band of Rs. 102 – Rs. 108 for share of Rs. 10 each. The IPO opens for subscription on July 30, 2025, and will close on August 01, 2025. The minimum application to be made is for 2400 shares and in multiple of 1200 shares thereon, thereafter. Post allotment, shares will be listed on BSE SME. The issue constitutes 29.56% of post-IPO paid-up equity capital of the company. From the net proceeds of the issue, the company will utilize Rs. 6.80 cr. for repayment/prepayment of certain borrowings of B D Ind., Rs. 7.30 cr. for working capital, Rs. 11.60 cr. for repayment/prepayment of material subsidy borrowings, Rs. 5.40 cr. for purchase of machinery of subsidiary, Rs. 7.30 cr. working capital of its subsidiary, and the rest for general corporate purposes.

The IPO is solely lead managed by Aryaman Financial Services Ltd., while Cameo Corporate Services Ltd. is the registrar to the issue. Aryaman group’s Aryaman Capital Markets Ltd., is the market maker. Aryaman Financial Services Ltd. is also a syndicate member.

After issuing initial equity shares at par, the company issued bonus shares in the ratio of 1000 for 1 in September 2024. The average cost of acquisition of shares by the promoters is Rs. 0.00, and Rs. 10.59 per share.

Post-IPO, company’s current paid-up equity capital of Rs. 10.01 cr. will stand enhanced to Rs. 14.21 cr. Based on the upper price band of the IPO, the company is looking for a market cap of Rs. 153.47 cr. 

FINANCIAL PERFORMANCE:
On the financial performance front, for the last three fiscals, the company has posted a total income/net profit of Rs. 55.10 cr. / Rs. 1.49 cr. (FY23), Rs. 55.33 cr. / Rs. 3.18 cr. (FY24), Rs. 84.13 cr. / Rs. 8.15 cr. (FY25). Boosted profits from FY24 onwards raise eyebrows.

For the last three fiscals, the company has reported an average EPS of Rs. 5.11, and an average RoNW of 28.22%. The issue is priced at a P/BV of 5.11 based on its NAV of Rs. 21.12 as of March 31, 2025, and at a P/BV of 2.31 based on its post-IPO NAV of Rs. 46.80 per share (at upper cap).

If we attribute its FY25 super earnings on post-IPO expanded equity base, then the asking price is at a P/E of 18.85, and based on its FY24 earnings, the P/E stands at 48.21. Thus, based on its recent financial data, the issue appears aggressively priced.

The company has reported PAT margins of 2.73% (FY23), 5.86% (FY24), 9.23% (FY25), and RoCE margins of 24.52%, 35.13%, 43.50%, respectively for the referred periods.

DIVIDEND POLICY:
The company has not declared any dividends for the reported periods of the offer document. It will adopt a prudent dividend policy, based on its financial performances and future prospects.

COMPARISON WITH LISTED PEERS:
As per offer document, the company has shown Nilkamal Ltd., Time Technoplast, Supreme Ind., as their listed peer. They are trading at a P/E of around 25.3, 26.2, and 61.6 (as of July 25, 2025). However, they are not truly comparable on an apple-to-apple basis.

MERCHANT BANKER’S TRACK RECORDS:
This is the 15th mandate from Aryaman Financial in the last three fiscals (including the ongoing one). From the last 14 listings, out of which 1 issue closed below the issue price on listing date.