Review By on August 22, 2017
Shish Industried Ltd (SIL) is engaged in the manufacturing of Plastic Twin wall and Multi wall corrugated sheets. It started exporting its products to various countries viz U.A.E, Myanmar and Oman and also enhance production capacity by installing additional machinery for manufacturing variety of products especially Polypropylene (PP) Corrugated Plastic Rolls which is an extruded 3ply and 5ply (GSM from 275GSM > 1000GSM) fluted PP corrugated plastic sheets consisting of two / multi flat walls connected by vertical ribs. The plastic corrugated sheets are flexible and as well as tough, to use in various industries and application like Construction – Building, Humanitarian Relief, Signage Board, Pet enclosures Packaging, Hobby Applications, Medical, Advertisement etc.
To part finance its planned capital expenditure, working capital and general corpus fund needs, SIL is coming out with a maiden IPO of 1352000 equity share of Rs. 10 each at a fixed price of Rs. 30 per share to mobilize Rs. 4.06 crore. Issue opens for subscription on 23.08.17 and will close on 28.08.17. Minimum application is to be made for 4000 shares and in multiples thereon, thereafter. Issue is solely lead managed by Corporate Capital Ventures Pvt Ltd and Bigshare Services Pvt Ltd is the registrar to the issue. Its entire paid up equity is issued at par value. Post issue its current paid up equity capital of Rs. 3.09 crore will stand enhanced to Rs. 4.44 crore. Post allotment, shares will be listed on BSE SME.
On performance front, for last three fiscals it has posted turnover/net profits of Rs.0.98 cr. / Rs. –(0.27) cr. (FY15), Rs. 3.88 cr. / Rs. 0.03 cr. (FY16) and Rs.5.37 cr. / Rs. 0.05 cr. (FY17). For period ended on 10.05.17 of the current fiscal it has posted net profit of Rs.0.01 cr. on a turnover of Rs. 0.88 cr. If we annualize these and attribute it to fully diluted equity post IPO then asking price is at a P/E of 150 plus against its peers trading around 15 P/E. Issue is priced at a P/BV of 3. Last thee year's average RoNW is negative.
On merchant banker's front, this is the first mandate from its stable and has no track record.
Conclusion: There is no harm in giving this highly priced issue a miss.
Review By on August 22, 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 Shish Industries Ltd. offers an early investment opportunity in Shish Industries Ltd.. A stock market investor can buy Shish Industries IPO shares by applying in IPO before Shish Industries Ltd. shares get listed at the stock exchanges. An investor could invest in Shish Industries IPO for short term listing gain or a long term.
Read the Shish Industries IPO recommendations by the leading analyst and leading stock brokers.
Shish Industries IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the Shish Industries IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts mentioned in the above answer to "How is Shish Industries IPO?"
Our recommendation for Shish Industries IPO is to avoid.
As per the analysis by our lead analyst Mr. Dilip Davda, we suggest you to avoid the Shish Industries IPO.
The Shish Industries IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit Shish Industries IPO allotment status to check.
