Review By on August 30, 2016
Sprayking Agro Equipments Ltd (SAEL) is engaged into manufacturing of Brass equipments. It mainly manufactures Brass Agro Equipments and Brass Plumbing components. It can also manufacture auto, electric and other fitting parts made from Brass.
To repay its unsecured loans and raise general corpus funds, the company is coming out with a small issue of 888000 equity shares of Rs. 10 each at a fixed price of Rs. 21 per share to mobilize Rs. 1.86 crore. Issue opens for subscription on 31.08.16 and will close on 02.09.16. Minimum application is to be made for 5000 shares and in multiples thereon, thereafter. Issue is solely lead managed by Pantomath Capital Advisors Pvt Ltd and Sharex Dynamic (India) Pvt Ltd is the registrar to the issue. Since inception in 2005 till 21.03.2011 it issued equity at par. Thereafter it issued equity at a price of Rs. 125 per share on28.03.11 and then at Rs. 21 per share in 2015 and 2016. Its current paid up equity capital of Rs. 2.28 crore will stand enhanced to Rs. 3.17 crore post this issue. Post allotment, shares will be listed on BSE SME.
On performance front, for the last four fiscals, the company has posted turnover / net profit of Rs. 11.31 cr. / Rs. 0.02 cr. (FY13), Rs. 16.40 cr. / Rs. 0.07 cr. (FY14), Rs. 14.36 cr. / Rs. 0.04 cr. (FY15) and Rs. 15.36 cr. / Rs. 0.05 cr. (FY16). If we attribute latest earnings on post issue equity then asking price is at a P/E of 131 plus making it a costly IPO. However, the issue price is below 1 P/BV. It has no peers to compare with as claimed by the company in prospectus.
On merchant banker’s front, this is the 23rd issue from its stable and it has mixed trends for its past mandates.
Conclusion: Based on its earnings the asking price is exorbitant. However, cash surplus risk savvy investors may consider it for long term investment; other may give it a miss.
Review By on August 30, 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 Sprayking Agro Equipment Ltd. offers an early investment opportunity in Sprayking Agro Equipment Ltd.. A stock market investor can buy Sprayking Agro Equipment IPO shares by applying in IPO before Sprayking Agro Equipment Ltd. shares get listed at the stock exchanges. An investor could invest in Sprayking Agro Equipment IPO for short term listing gain or a long term.
Read the Sprayking Agro Equipment IPO recommendations by the leading analyst and leading stock brokers.
Sprayking Agro Equipment IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the Sprayking Agro Equipment IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts mentioned in the above answer to "How is Sprayking Agro Equipment IPO?"
Our recommendation for Sprayking Agro Equipment 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 Sprayking Agro Equipment IPO.
The Sprayking Agro Equipment IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit Sprayking Agro Equipment IPO allotment status to check.
