Review By on May 20, 2018
Nakoda Group of Industries Ltd. (NGIL) is engaged in manufacturing of tutti fruity (diced chelory) which is also called “Papaya Preserve” and canned fruit cubes that comes under the category of bakery products. It is also engaged in processing of almonds, trading of sesame seeds, clove, cutpeel murabba, karonda, daalchini and toor dal.
To part finance its working capital and general corpus fund needs, NGIL is coming out with a maiden IPO of 1852000 equity shares of Rs. 10 each at a fixed price of Rs. 35 per share to mobilize Rs. 6.48 crore. Issue opens for subscription on 23.05.18 and will close on 29.05.18. Minimum application is to be made for 4000 shares and in multiples thereon, thereafter. Post allotment, shares will be listed on BSE SME. Issue is solely lead managed by Pantomath Capital Advisors Pvt. Ltd. and Bigshare Services Pvt. Ltd. is the registrar to the issue. Issue constitutes 27.03% of post issue paid up capital of the company. It has raised entire equity at par so far. Cost of acquisition of shares by the promoters is Rs. 10 per share. Post issue, its current paid up equity capital of Rs. 5.00 crore will stand enhanced to Rs. 6.85 crore. Its debt equity ratio as on 31.12.17 is 3.46.
As NGIL took over a business of proprietory concern in July 2016 and merged with it, it has working data of short period. For FY 17 it posted a turnover of Rs. 23.79 cr. with a net profit of Rs. 0.48 cr. For first nine months ended on 31.12.17 of FY18 it earned net profit of Rs. 0.99 cr. on a turnover of Rs. 43.95 cr. As per offer documents, for last three fiscals it has posted an average EPS of Rs. 1.23 and an average RoNW of – (1.87%). Issue is priced at a P/BV of 2.75 based on its NAV of Rs. 12.73 as on 31.12.17 and at a P/BV of 1.85 based on post issue NAV of Rs. 18.91. If we annualize latest earnings and attribute it on fully diluted equity post issue, then asking price is at a P/E of around 18. It has no listed peers to compare with.
On merchant banker’s front, this is 62nd mandate from its stable in last three fiscals. Out of last 10 listings all opened with a premium on offer price ranging from 1.59% to 40% on the day of listing.
Although company’s performance data is for just around two fiscals, considering its business in FMCG sector, investors may consider investment for long term.
Review By on May 20, 2018
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 Nakoda Group of Industries Ltd. offers an early investment opportunity in Nakoda Group of Industries Ltd.. A stock market investor can buy Nakoda Group of Industries IPO shares by applying in IPO before Nakoda Group of Industries Ltd. shares get listed at the stock exchanges. An investor could invest in Nakoda Group of Industries IPO for short term listing gain or a long term.
Read the Nakoda Group of Industries IPO recommendations by the leading analyst and leading stock brokers.
Nakoda Group of Industries IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the Nakoda Group of Industries IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts mentioned in the above answer to "How is Nakoda Group of Industries IPO?"
Our recommendation for Nakoda Group of Industries 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 Nakoda Group of Industries IPO.
The Nakoda Group of Industries IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit Nakoda Group of Industries IPO allotment status to check.
