Review By on November 18, 2014
One more SME IPO is opening in the last week of November 2014 for BSE SME listing. Details of the same are as under:
Captain Pipes Ltd. (CPL), manufactures a wide range of high tensile and high impact uPVC threaded Column Pipes, uPVC Plumbing Pipes, uPVC Pressure Pipes, uPVC Casing Pipes, uPVC Plumbing Fittings and uPVC Agri Fittings. CPL is also a supplier of HDPE Pipes (being procured from Captain Polyplast Limited, the Promoter Company which manufactures the same on job work basis) and uPVC Column Pipes Fittings being procured from identified manufacturer as per specifications. It assembles the procured uPVC Column Pipes with accessories and supplies the assembled products to uPVC threaded Column Pipes customers. Companies products are widely used by agriculture and construction sector consumers. Its installed capacity is 17,700MT per annum.
To meet is fund requirement and repayment of loan, the company is issuing 1101000 equity share of Rs. 10 each at a fixed price of Rs. 40 per share to mobilize Rs. 4.40 crore. Issue opens for subscription on 26.11.14 and will close on 01.12.14. Minimum application is to be made for 3000 shares and in multiples thereof, thereafter. Issue is lead managed by Hem Securities Ltd. Sharepro Services (India) Pvt Ltd is the registrar to the issue. Post allotment shares will be listed on BSE SME. Its current equity of Rs. 3.06 crore post bonus issue in the ratio of 1 for 1 in September 2014 will rise to Rs. 4.16 crore post this IPO.
On performance front, the company has posted an average EPS of Rs. (0.79) i.e. it has incurred losses. For the first half of the current fiscal it has earned net profit of Rs. 0.34 crore on a turnover of Rs. 15.37 crore. If we attribute these earnings on fully diluted equity post of Rs. 4.16 crore post IPO, the asking price is at a P/E of 24 plus making it a costly bet.
On merchant banker’s front, this is 12th mandate from it. In earlier 11 mandates, we have witnessed returns on investment for nine mandates. This indicates at better market making by this merchant banker.
Considering the barriers on minimum investment and low preference by major broking community, only risks aver high net-worth individuals may park their surplus funds in this costly bet at their own discretion.
Review By on November 18, 2014
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 Captain Pipes Ltd. offers an early investment opportunity in Captain Pipes Ltd.. A stock market investor can buy Captain Pipes IPO shares by applying in IPO before Captain Pipes Ltd. shares get listed at the stock exchanges. An investor could invest in Captain Pipes IPO for short term listing gain or a long term.
Read the Captain Pipes IPO recommendations by the leading analyst and leading stock brokers.
Captain Pipes IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the Captain Pipes IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts mentioned in the above answer to "How is Captain Pipes IPO?"
Our recommendation for Captain Pipes IPO is to avoid.
As per the analysis by our lead analyst Mr. Dilip Davda, we suggest you to avoid the Captain Pipes IPO.
The Captain Pipes IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit Captain Pipes IPO allotment status to check.
