Review By on March 27, 2015
O P Chains Ltd. (OPCL) is a north centric Bullion dealer of Gold and Silver and other precious metals specializing in bars and coins of various precious metals like Gold and Silver. It offers wholesale delivery of bullion to domestic users i.e. ornament manufacturers, goldsmiths, jewellers and semi-wholesalers. OPCL operates as an important intermediary in bullion trading industry whereby it purchase materials such as Gold, Silver and other precious metals etc. from State Trading Corporation of India, Hindustan Zinc Limited, ICICI Bank Limited, Punjab National Bank Limited and SB Ornaments Pvt. Ltd., and supply to customers in the Jewelry industry to various jewelers and related business.
To meet its working capital requirements, the company is coming out with an IPO of 1850000 equity share of Rs. 10 each at a fixed price of Rs. 11 per share to mobilize Rs. 2.04 crore. Issue opens for subscription on 30.03.15 and will close on 08.04.15. Minimum application is to be made for 10000 shares and in multiples thereon, thereafter. Post allotments, shares will be listed on BSE SME. Issue is lead managed by Hem Securities Ltd and Bigshare Services Pvt Ltd. Between December 2011 to December 2003 it issued 2344900 shares at a fixed price of Rs. 60 per share to promoters to take its paid up capital to Rs. 5 crore. Post issue it’s paid up equity will rise to Rs. 6.85 crore from Rs. 5.00 crore.
On performance front, the company for the fiscals 2012, 2013 and 14 it clocked in turnover and (loss)/net profits of Rs. 592.41/Rs. 0.62 crore, Rs. 239.58 crore/(Rs. 0.18 crore) and Rs. 259.18 crore/Rs. 0.11 crore respectively. For the first half ended on 30.09.14 it has earned net profit of Rs.0.10 crore on a turnover of Rs. 155.78 crore. If we annualized these earnings and evaluate on fully diluted equity post IPO then the EPS stands at Rs. 0.29 and thus the asking price at Rs. 11 per share is at a P/E of 37 plus making it aggressively priced.
With drastic fall in the prices of Gold and Silver in past two years, the business is affected. Hence there is no harm giving this issue a miss.
This is the 13th IPO from this Merchant Banker and he has mixed performance for IPOs post listings.
DISCLAIMER: No financial information whatsoever published anywhere here should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is purely for educational and information purposes only and under no circumstances should be used for making investment decisions. Readers must consult a qualified financial advisor prior to making any actual investment decisions, based on information published here. As SME issues have entry barriers and low preference from broking community, any reader taking decisions based on any information published here does so entirely at own risk. Author has no plans to invest in this offer.
Review By on March 27, 2015
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 O.P.Chains Ltd. offers an early investment opportunity in O.P.Chains Ltd.. A stock market investor can buy O.P.Chains IPO shares by applying in IPO before O.P.Chains Ltd. shares get listed at the stock exchanges. An investor could invest in O.P.Chains IPO for short term listing gain or a long term.
Read the O.P.Chains IPO recommendations by the leading analyst and leading stock brokers.
O.P.Chains IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the O.P.Chains IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts mentioned in the above answer to "How is O.P.Chains IPO?"
Our recommendation for O.P.Chains 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 O.P.Chains IPO.
The O.P.Chains IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit O.P.Chains IPO allotment status to check.
