Review By on March 17, 2016
CHD Chemicals Ltd (CHD) is engaged in the business of trading and distribution of high quality chemicals and dyes for textiles industry, leather, and paper industries. It also deals in Construction Chemicals. CHD is a chemicals and dyes trading and distribution company with a diverse product portfolio.
To part finance its working capital needs and general corpus funding, the company is coming out with a maiden IPO of 1800000 equity shares of Rs. 10 each at a fixed price of Rs. 11 per share to mobilize Rs. 1.98 crore. Issue opens for subscription on 21.03.16 and will close on 23.03.16. Minimum application is to be made for 10000 shares and in multiples thereon, thereafter. First Overseas Capital Ltd is the sole lead manager and Cameo Corporate Services Ltd is the registrar to the issue. Post allotment, shares will be listed on BSE SME. Its current paid up equity capital of Rs. 3.41 crore will stand enhanced to Rs. 5.21 crore post IPO. In February 2015 it issued around 9 lakh shares at a price of Rs. 11 per share and all previous issues were at par value.
On performance front, the company has posted net profit of Rs. 0.09 cr. on a turnover of Rs. 14.39 cr. (FY 14) and net profit of Rs. 0.21 cr. on a turnover of Rs. 44.48 cr. (FY 15). For first six months of the current fiscal it has reported net profit of Rs. 0.15 cr. on a turnover of Rs. 18.72 cr. If we annualize this and attribute on fully diluted equity of Rs. 5.21 crore post issue then asking price is at a P/E of around 19. As per IPO documents, company has no listed peer to compare with.
On merchant banker’s front, this is 12th mandate from its stable and it has poor track records for past mandates.
Risk savvy investors with surplus funds may consider investment for long term plan.
Review By on March 17, 2016
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 CHD Chemicals Ltd. offers an early investment opportunity in CHD Chemicals Ltd.. A stock market investor can buy CHD Chemicals IPO shares by applying in IPO before CHD Chemicals Ltd. shares get listed at the stock exchanges. An investor could invest in CHD Chemicals IPO for short term listing gain or a long term.
Read the CHD Chemicals IPO recommendations by the leading analyst and leading stock brokers.
CHD Chemicals IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the CHD Chemicals IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts mentioned in the above answer to "How is CHD Chemicals IPO?"
Our recommendation for CHD Chemicals IPO is to subscribe.
As per the analysis by our lead analyst Mr. Dilip Davda, we suggest you to subscribe to the CHD Chemicals IPO.
The CHD Chemicals IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit CHD Chemicals IPO allotment status to check.
