Review By on March 8, 2013
Bothra Metals & Alloys Ltd. (BMAL) -deals in wide range of the Aluminum Product that caters the customer throughout the globe. It is engaged in Aluminum products such as Extrusions, Ladder Section, Billets, Profile, Section and Electronic Extrusion, Ingots, Shots, Alloys Ingots that meet stringent quality norm's at the most competitive prices with constant product enhancements along with utmost commitment towards quality control and customer service. BMAL's facilities are located at Himachal Pradesh (kala-amb), Gujarat (Bhavnagar), and Maharashtra (Sangli) with modern and latest machinery. It has in house foundry with modern melting furnace including fully automatic hot top casting technology. To raise working capital and general corpus funds, the company is coming out with a fixed price IPO of 4884000 equity shares of Rs. 10 each at a price of Rs. 25 per share (including offer for sale of 2292000 equity shares). Issue opens for subscription on 12th March and will close on 14th March 2013. Minimum application is to be made for 6000 shares and in multiples thereof thereafter. Post allotment the shares will be listed no BSE SME. Issue is lead managed by Sarthi Capital Advisors Pvt. Ltd. and Sharex Dynamic India Pvt. Ltd is the registrar to the issue. Between 2007 & 2011 the company made preferential allotment of shares in the price range of Rs. 20 to Rs. 70 per share and has also issued bonus in the ratio of 4 for 1 in October 2010 and 1 for 1 in July 2011.
On company's performance front, it has posted an average EPS of Rs. 2.35 for last three fiscals with inconsistent bottom line and NAV is Rs. 13.08 as at 31.3.2012. For six months ended 30.09.12 it has posted an EPS of Rs. 3.53 on an equity base of Rs. 15.91 crore. Post issue equity will rise to Rs. 18.51 crore translating into an EPS of Rs.3.03 for the said earnings resulting into P/E of 8 plus making it a costly bet compared to its peer's trading around 4 to 5 P/E.
Perhaps this is the first mandate for the Lead manager as no track record is available for past mandates.
Considering the fate of SME IPOs post listing, despite market making, skipping of this issue is advisable.
Review By on March 8, 2013
Dilip Davda is a veteran financial journalist associated with the Indian stock market since 1978. He has been contributing to print and electronic media on capital markets, insurance, and finance since 1985.
He is widely recognized for reviewing public issues and non-convertible debentures (NCDs) in the primary market. Drawing on over three decades of market experience and close interaction with merchant bankers, his reviews focus on detailed fundamental and financial analysis of companies, with a special emphasis on SME public issues.
Dilip Davda
SEBI Registered Research Analyst – Mumbai
Registration No.: INH000003127 (Perpetual)
Email: dilip_davda@rediffmail.com
Disclaimer: The information provided herein is solely for educational and informational purposes and does not constitute an offer, solicitation, or recommendation to buy or sell any securities. Readers are advised to consult a qualified financial advisor before making any investment decisions. Investments in the securities market are subject to market risks. The author does not intend to invest in the securities discussed.
The initial public offer (IPO) of Bothra Metals & Alloys Ltd. offers an early investment opportunity in Bothra Metals & Alloys Ltd.. A stock market investor can buy Bothra Metals IPO shares by applying in IPO before Bothra Metals & Alloys Ltd. shares get listed at the stock exchanges. An investor could invest in Bothra Metals IPO for short term listing gain or a long term.
Read the Bothra Metals IPO recommendations by the leading analyst and leading stock brokers.
Bothra Metals IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the Bothra Metals IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts mentioned in the above answer to "How is Bothra Metals IPO?"
Our recommendation for Bothra Metals IPO is to avoid.
As per the analysis by our lead analyst Mr. Dilip Davda, we suggest you to avoid the Bothra Metals IPO.
The Bothra Metals IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit Bothra Metals IPO allotment status to check.
