Review By on December 7, 2017
Diggi Multitrade Ltd. (DML) – (erstwhile known as Diggi Securities Pvt. Ltd.) was initially engaged in securities trading in stock markets. In 2013-14 it forayed into trading of fabrics, real estate, allied activities and construction material and changed its name.
To part finance its incremental working capital and general corpus fund needs DML is coming out with a maiden IPO of 2600000 equity shares of Rs. 10 each at a fixed price of Rs. 13 per share to mobilize Rs. 3.38 crore. Issue opens for subscription on 11.12.17 and will close on 14.12.17. Minimum application is to be made for 10000 shares and in multiples thereon, thereafter. Post allotment shares will be listed on BSE SME. Issue is solely lead managed by Gretex Corporate Services Pvt Ltd and Purva Sharegistry (India) Pvt. Ltd. is the registrar to the issue. Issue constitutes 26.87% of the post issue paid up capital of the company. The average cost of acquisition of shares by the promoters is Rs. 10. It has issued entire equity at par so far. Post issue, its current paid up equity capital of Rs. 7.08 crore will stand enhanced to Rs. 9.68 crore.
On performance front, DML has posted turnover/net profits of Rs. 0.60 cr. / Rs. 0.02 cr. (FY14), Rs. 2.07 cr. / Rs.0.03 cr. (FY15), Rs. 1.00 cr./ Rs. – (0.03) cr. (FY16) and Rs. 1.88 cr. / Rs. 0.06 cr. (FY17). Surprisingly, for the first half of current fiscal it has earned net profit of Rs. 0.24 cr. on a turnover of Rs. 1.83 cr. Issue is priced at a P/BV of 1.24 and 1.17 on the basis of its NAV as on 30.09.17 as well as post issue. For last three fiscals it has posted an average EPS of Rs.0.05 and average RoNW of 0.39%. If we annualize latest earnings and attribute on fully diluted equity post issue, then asking price is at a P/E of 26 thus issue is aggressively priced. It has not listed peers to compare with.
On merchant banker's front, this is the 9th mandate from its stable in past three years. Out of last 8 listings 3 opened at discount, 4 at par and 1 with just 0.40% premium to offer price on the day of listings. Thus it has poor track record.
Review By on December 7, 2017
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 Diggi Multitrade Ltd. offers an early investment opportunity in Diggi Multitrade Ltd.. A stock market investor can buy Diggi Multitrade IPO shares by applying in IPO before Diggi Multitrade Ltd. shares get listed at the stock exchanges. An investor could invest in Diggi Multitrade IPO for short term listing gain or a long term.
Read the Diggi Multitrade IPO recommendations by the leading analyst and leading stock brokers.
Diggi Multitrade IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the Diggi Multitrade IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts mentioned in the above answer to "How is Diggi Multitrade IPO?"
Our recommendation for Diggi Multitrade IPO is to avoid.
As per the analysis by our lead analyst Mr. Dilip Davda, we suggest you to avoid the Diggi Multitrade IPO.
The Diggi Multitrade IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit Diggi Multitrade IPO allotment status to check.
