BharatRohan Airborne BSE SME IPO review

•    The company is engaged in providing agritech and agri value chain solutions.
•    It is having a novel emerging business model that is likely flourish going forward.
•    The company posted growth in its top and bottom lines for the reported periods.
•    Based on its recent financial data, the issue appears fully priced.
•    Well-investors may park funds for medium to long term.
•    It may catch first mover fancy post listing.

ABOUT COMPANY:
BharatRohan Airborne Innovations Ltd. (BAIL) is engaged in an emerging business model, distinguishing itself as an agritech and agri value chain solutions provider. It leverages drone/UAV based platforms, with a main focus on Hyperspectral Imaging (HSI) technology. This allows the Company to offer a comprehensive suite of services and products that address critical challenges across the agricultural value chain, which includes, advisory on the crop production and guidance on the Integrated Crop Management Practices which enables the sale of Agricultural Output and Agricultural Input products by the Company. 

BAIL is a vertically integrated Agri-tech company focused on enabling farmers to grow profitably using Decision Support System (DSS) based on Hyperspectral Imaging and other imaging technologies. The company boasts a diversified portfolio of services and products. It delivers a comprehensive range of solutions to associated farmers, specifically: (a) Providing of Crop Monitoring Services (CMS) via drones, which includes Integrated Crop Management (ICM) Practices; and (b) Sale of various branded agri-inputs, prominently featuring its proprietary brand, 'Pravir.' The company also engages in the sale of agri-output products, for which Integrated Crop Management Practices were provided by the Company and whose requirements are met throughout the agricultural value chain. 

This diversification allows it to cater to a broader spectrum of agricultural needs, offering clientele a complete suite of solutions. Its primary objective is to empower farmers by generating revenue opportunities through improved farming solutions. This holistic approach underscores a robust business with significant potential for future expansion within the agritech landscape.

BAIL’s portfolio encompasses the trading of various branded agri-inputs, including its proprietary brand, ‘Pravir.’ The sale of these inputs directly links to insights from CMS. This ensures farmers receive inputs tailored to their crop needs. To ensure implementation and accessibility, the Company has established BharatRohan Facilitation Center (identified as BharatRohan Pragati Kendra). These centers serve as touchpoints for farmers, providing access to agri-inputs and offering advisory on how to implement recommended practices. This approach, from drone-based insights to accessible inputs and on-ground support at the Pragati Kendras, enable the Company to create revenue opportunities for farmers through farming solutions.

The company is Setting up Manufacturing unit at jodhpur for cleaning, sorting and Packaging of Agri Output. It also intends to set up a new Direct to Customer model to facilitate the selling of agricultural products like spices, pulses, and oilseeds directly to consumers through Quick Commerce Platforms such as Swiggy Instamart, etc., and Modern Retail Chains. For FY25 it served 12729 farmers against 2714 for FY23. As of June 30, 2025, it had 39 employees on its payroll, and additional 20 contract workers.

ISSUE DETAILS/CAPITAL HISTORY:
The company is coming out with its maiden book building route IPO of 5299200 equity shares to mobilize Rs. 45.04 cr. (at the upper cap). It has announced a price band of Rs. 80 – Rs. 85 per share of Rs. 10 each. The IPO opens for subscription on September 23, 2025, and will close on September 25, 2025. The minimum application to be made is for 3200 shares and in multiple of 1600 shares thereon, thereafter. Post allotment, shares will be listed on BSE SME. The issue constitutes 26.60% of post-IPO paid-up equity capital of the company. From the net proceeds of the issue, the company will utilize Rs. 14.21 cr. for capex on new plant and machinery, Rs. 2.29 cr. for purchase of commercial vehicles, 16.68 cr. for working capital, and the rest for general corporate purposes.

The IPO is solely lead managed by Smart Horizon Capital Advisors Pvt. Ltd., while KFin Technologies Ltd. is the registrar to the issue. Rikhav Securities Ltd. is the market maker. Shreni Shares Ltd. is a syndicate member.

The company has issued/converted initial equity shares at par, and issued further equity shares in the price range of Rs. 85 – Rs. 4980.08 per share between March 2018 and February 2025. It has also issued bonus shares in the ratio of 190 for 1 in November 2023, and 3 for 1 in September 2024. The average cost of acquisition of shares by the promoters is Rs. Rs. 0.01 per share. 

Post-IPO, company’s current paid-up equity capital of Rs. 14.62 cr. will stand enhanced to Rs. 19.92 cr. Based on the upper price band of the IPO, the company is looking for a market cap of Rs. 169.35 cr. 

FINANCIAL PERFORMANCE:
On the financial performance front, for the last three fiscals, the company has posted a total revenue/net profit, of Rs. 6.53 cr. / Rs. 1.81 cr. (FY23), Rs. 18.98 cr. / Rs. 6.90 cr. (FY24), Rs. 28.23 cr. / Rs. 7.59 cr. (FY25). The company posted growing top and bottom lines for the reported periods. While it has given financial data on the basis of standalone for FY232 and FY24, and on the basis of consolidated for FY25. 

For the last three fiscals, the company has reported an average EPS of Rs. 4.73, and an average RoNW of 34.06%. The issue is priced at a P/BV of 3.32 based on its NAV of Rs. 25.61 as of March 31, 2025, but its post-IPO NAV data is missing from the offer documents.

If we attribute its FY25 super earnings on post-IPO expanded equity base, then the asking price is at a P/E of 22.31, and based on its FY24 earnings, the P/E stands at 24.50. Thus, prima-facie, the issue appears fully priced.

The company has posted PAT margins of 27.96% (FY23), 36.42% (FY24), 26.93% (FY25), and RoCE Margins of 19.30%, 35.42%, 19.69%, 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 the offer document, the company has no listed peers to compare with.

MERCHANT BANKER’S TRACK RECORDS:
This is the 11th mandate from Smart Horizon in the last two fiscals (including the ongoing one). Out of last 10 listings, 1 opened at discount, 1 at par, and the rest opened at premium ranging from 0.81% to 90.00% on the date of listing.