Review By on September 29, 2016
India Green Reality Ltd (IGRL) is a real estate developer with a diversified portfolio of real estate projects and engaged in the business of development and sale of residential and commercial properties including identification and acquisition of land, development of land, acquisition of development rights of projects, marketing of projects/land. Currently, the company is having three diversified projects at West Bengal and Gujarat and focusing on opportunities to build its brand in these two states. IGRL is building bungalows of varying sizes with focus on affordable pricing at Sonarpur-Kolkata and Shantiniketan -Bolpur, both projects in the state of West Bengal. It is developing and selling plot of land and constructing bungalows as well at Nal Sarover, Gujarat. Its forthcoming projects are at Jaisalmer-Rajasthan, and Sasan Gir-Gujarat.
To part finance its working capital needs and general corpus fundings, the company is coming out with a maiden IPO of 3460000 equity share of Rs. 10 each at a fixed price of Rs. 30 per share to mobilize Rs. 10.38 crore. Issue opens for subscription on 30.09.16 and will close on 06.10.16. Minimum application is to be made for 4000 shares and in multiples thereon, thereafter. Issue is solely managed by Guiness Corporate Advisors Pvt Ltd. and Karvy Computershare Pvt Ltd is the registrar to the issue. Post allotment, shares will be listed on BSE SME. Since inception till 2015 it issued equity at par and then in 2016 it issued further equity at a fixed price of Rs. 60 and Rs. 75. It also issued bonus in the ratio of 25 for 10 in July 2016. Post issue, its current paid up equity capital of Rs. 9.25 crore will stand enhanced to Rs. 12.71 crore.
On performance front, for last four fiscals it has reported turnover/net profits of Rs.1.69 cr. / Rs. 0.08 cr. (FY13), Rs. 0.95 cr. / Rs. 0.15 cr. (FY14), Rs. 1.44 cr. / Rs. (-0.08 cr.) (FY15) and Rs. 41.37 cr. / Rs. 2.28 cr. (FY16). IGRL has reported spectacular performance only for FY16 that is raising eyebrows. However, if we attribute latest earnings on fully diluted equity post IPO then asking price is at a P/E of 16 plus. As per prospectus, its peers are trading at a P/E of around 10 and 21.
On merchant banker’s front, this is 13th mandate from its stable in last three years and it has erratic track record with few of its past mandate being suspended from trading.
Conclusion: This IPO can be termed as “High Risk – Low yield bet” as sudden push in top line and bottom line in the last fiscal raising concern. Only cash surplus risk savvy investors may consider investment for long term.
Review By on September 29, 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 India Green Reality Ltd. offers an early investment opportunity in India Green Reality Ltd.. A stock market investor can buy India Green Reality IPO shares by applying in IPO before India Green Reality Ltd. shares get listed at the stock exchanges. An investor could invest in India Green Reality IPO for short term listing gain or a long term.
Read the India Green Reality IPO recommendations by the leading analyst and leading stock brokers.
India Green Reality IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the India Green Reality IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts mentioned in the above answer to "How is India Green Reality IPO?"
Our recommendation for India Green Reality IPO is to subscribe for long term.
As per the analysis by our lead analyst Mr. Dilip Davda, we suggest you to subscribe for long term to the India Green Reality IPO.
The India Green Reality IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit India Green Reality IPO allotment status to check.
