Justo Realfintech BSE SME IPO review (Not Rated)

•    The company is engaged as a full-service real estate mandate company operating in Pune, Nashik, Mumbai, Aurangabad, and Kolhapur.
•    The company marked minor setback for FY24 in line with the general trends in the sector.
•    While it has completed projects worth Rs. 8150 cr. till March 31, 2025, it had order book worth Rs. 4149.56 cr. as of August 31, 2025.
•    Based on recent financial data, the IPO appears fully priced.
•    The company enjoys niche place in comprehensive services in realty segment.
•    It may catch first mover fancy post listing.
•    Well-informed investors may park funds for long term.

ABOUT COMPANY:
Justo Realfintech Ltd. (JRL) is a full-service real estate mandate company based in Maharashtra, with operations in Pune, Mumbai Metropolitan Region (“MMR”), and Nashik, with additional presence in Aurangabad and Kolhapur. It provides solutions including decisions on pricing and sizing of the projects to real estate developers and enabling the delivery of the products to the end customers. It has established a considerable presence in Pune and are rapidly expanding footprint in Mumbai. The company distinguish itself through tech-enabled platforms that streamlines project onboarding, customer engagement and sales processes. 

Leveraging data-driven insights and digital tools, the Company ensures enhanced visibility and conversion for its real estate developer partners. With a wide-reaching channel partner (“CP”) network and deep understanding of local market dynamics in which it operates, it offers end-to-end solutions across sales strategy, marketing, and execution. (Source: Liases Foras report). Its role involves efficiently managing multiple aspects of the inventory of real estate developers and realizing through a large network of over 3,400 channel partners. The company primarily work with a focused niche of real estate developers who primarily operate in the lower-to-mid segment residential and commercial developments. It also assists in arranging credit arrangements for their acquisition, construction and development from banks, NBFCs and other financial institutions.

JRL’s business model focuses on providing services which include but are not limited to providing comprehensive advisory and execution services across business and sales strategy, marketing, CRM and financing solutions. Its endeavour is to take over and manage the end-to-end customer journey for real estate purchases from the initial inquiry stage to the final transaction while freeing up the resources of real estate developers to focus on their core competence i.e., obtaining statutory approvals and property development. This approach and service model is a novel proposition where the developer can completely concentrate on their core competencies, thereby building scale and faster growth in their area of operations. 

JRL’s expertise and services lie in micro market analysis, identifying market and need gaps, defining product positioning and mapping of competitive products, as well as leveraging tech-enabled sales strategies to help developers achieve optimum realization of project inventory. Its service offerings assist in managing cash flows for the real estate developers to ensure timely completion of projects leading to repayment of loans and handover of asset delivery to the customers.

Its value chain and integrated offering, combined with the use of custom-built proprietary technology and third-party software in service delivery process, enables the company to drive efficient and transparent customer engagement and map the entire customer journey for each transaction across developers and projects. In addition to the customer journey, it has a strong channel partner network of over 3,400 channel partners as on March 31, 2025. This channel partner network acts as a catalyst improving customer reach and execution of its mandate services business in a swift and efficient manner.

Since incorporation, the company has assisted real estate developers to sell projects worth over Rs. 8150 cr. representing over 11,250 units till March 31, 2025. As of August 31, 2025, it had active mandates with 37 real estate projects in the city of Pune, Mumbai, and Nashik to sell projects with a potential worth of over 4149.56 cr. representing over 3559 units.

Its track record includes collaborations with experienced real estate developers in the industry, such as Paranjape Spaces and Services Private Limited, Sneha Constructions, Ellora Heritage LLP, Satyam Infra Reality LLP, Paras Multispace LLP, Metrosatyam Builders LLP, Metrosatyam Developers, Benchmark Realty Private Limited, Aarnik Realty LLP, ARC Finezza developers LLP, Kele Real Corp Private Limited, Landlord Properties Private Limited, P R Associates, Abhinav Realty & Infrastructure LLP, Paras Multispace LLP, Siddharth Properties, Tejraj Realtors LLP and Saniket Buildcon. Through these relationships and associations, it has established a strong brand presence and a reputation for quality services in Pune and MMR, further consolidating its position as a prominent real estate mandate company.

ISSUE DETAILS/CAPITAL HISTORY:
The company is coming out with its maiden book building route IPO of 4961000 equity shares to mobilize Rs. 63.01 cr. at the upper cap. It has announced a price band of Rs. 120 – Rs. 127 per share of Rs. 10 each.  The IPO opens for subscription on September 24, 2025, and will close on September 26, 2025. The minimum application to be made is for 2000 shares and in multiple of 1000 shares thereon, thereafter. Post allotment, shares will be listed on BSE SME. The issue constitutes 26.39% of post-IPO paid-up equity capital of the company. From the net proceeds of the issue, the company will utilize Rs. 36.50 cr. for working capital, Rs. 6.30 cr. for investment in IT infrastructure and development of technology platform, Rs. 5.00 cr. for repayment of certain borrowings, and the rest for general corporate purpose.

The IPO is solely lead managed by Vivro Financial Services Pvt. Ltd., while Purva Sharegistry (India) Pvt. Ltd. is the registrar to the issue. Rikhav Securities Ltd. is the market maker. Vivro Financial Services Pvt. Ltd. is also a syndicate member.

The company has issued initial equity shares at par, and issued further equity shares in the price range of Rs. 141 – Rs. 5283 per share between July 2019, and August 2024. It has also issued bonus shares in the ratio of 85 for 1 in February 2025. The average cost of acquisition of shares by the promoters is Rs. 2.35 per share. 

Post-IPO, company’s current paid-up equity capital of Rs. 13.84 cr. will stand enhanced to Rs. 18.80 cr. Based on the upper price band of the IPO, the company is looking for a market cap of Rs. 238.74 cr. 

FINANCIAL PERFORMANCE:
On the financial performance front, for the last three fiscals, the company has (on a consolidated basis) posted a total income/net profit, of Rs. 70.55 cr. / Rs. 15.30 cr. (FY23), Rs. 59.45 cr. / Rs. 6.69 cr. (FY24), Rs. 81.64 cr. / Rs. 15.21 cr. (FY25). While its top and bottom lines marked inconsistency. Drastic fall in FY24 is attributed to sluggish demand and crisis in developers.

For the last three fiscals, the company has reported an average EPS of Rs. 10.14 (basic), and an average RoNW of 48.98%. The issue is priced at a P/BV of 3.42 based on its NAV of Rs. 37.15 as of March 31, 2025, and at a P/BV of 2.09 based on its post-IPO NAV of Rs. 60.86 per share (at the upper cap).

If we attribute its FY25 super annualized earnings on post-IPO expanded equity base, then the asking price is at a P/E of 15.70, and based on its FY24 earnings, the P/E stands at 35.67. Thus, based on its recent consolidated financial data, the issue appears fully priced.

The company has posted PAT margins of 21.68% (FY23), 11.26% (FY24), 18.63% (FY25), and RoCE Margins of 136.48%, 34.31%, 44.18%, respectively for the referred periods. 

DIVIDEND POLICY:
The company has not declared any dividends for the reported periods of the offer document. It has adopted a dividend policy in February 2025, based on its financial performances and future prospects.

COMPARISON WITH LISTED PEERS:
As per the offer document, the company has no listed peers to compare with.

MERCHANT BANKER’S TRACK RECORDS:
The Lead Manager has handled 8 public issues in the last three fiscals, and out of that 1 IPO closed below the offer price on listing date.