Review By on February 9, 2016
Sylph Education Solutions (SES) is engaged in providing educational services in the field of information technology (I.T) which is comprises of providing basic I.T training at two centers namely 'Little Wonder', a primary school and 'IT Gurus'. The company is tutoring basic computer knowledge, internet, surfing, computer courses like Microsoft office, accounting and financial management, inventory management, statutory capabilities, tally.net capabilities, accounting courses like tally, various computer languages i.e C++,.Net, Java and Oracle, communication and soft skills etc. Its revenue comprises of sale of software, skill development fees, services provided to school and interest income. However, at present company is not providing services to the school.
To part finance set up of two new centers for establishment of projects for skill development, raising general corpus fund, the company is coming out with a maiden public issue of 4000000 equity share of Rs. 10 each at a fixed price of Rs. 12 per share to mobilize Rs. 4.80 crore. Issue opens for subscription on 10.02.16 and will close on 15.02.16. Minimum application is to be made for 10000 shares and in multiples thereon, thereafter. Post allotment, shares will be listed on BSE SME. Issue is lead managed by Corporate Strategic Allianz Ltd and Purva Sharegistry India Pvt Ltd is the registrar to the issue. The company that issued initial equity at par in 2010 and 2012 has raised money at a premium price of Rs. 100 each (FV Re. 1) in March 2012, at Rs. 22.75 in February 2014 (FV Re. 1), at Rs. 225 per share (FV Rs. 10) in March 2014, at Rs. 112.50 (FV Rs. 10) between April-June 2014 and has issued two bonus issues in the ratio of 1 for 1 (April 2014) and 10 for 1 (July 2015). Its current paid up equity capital of Rs. 11 crore will stand enhanced to Rs. 15 crore post this issue.
On performance front, the company’s top/ bottom line has seen growth from Rs. 0.11 crore/Rs. 0.002 crore (FY 2013) to Rs. 0.46 crore/Rs. 0.07 crore (FY 2015). For six months ended 30.09.15 it has posted net profit of Rs. 0.03 crore on a turnover of Rs. 0.18 crore. If we annualize and attribute these earnings on fully diluted equity post IPO then asking price is at a P/E of 3000 and thus based on its revenue and earnings track records so far, it is aggressively priced offer.
On merchant banker’s front, it has poor track record for its past mandates. This is the sixth IPO from its stable.
Considering track record of performance and aggressive pricing, there is no harm giving this expensive offer a miss.
Review By on February 9, 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 Sylph Education Solutions Ltd. offers an early investment opportunity in Sylph Education Solutions Ltd.. A stock market investor can buy Sylph Education Solutions IPO shares by applying in IPO before Sylph Education Solutions Ltd. shares get listed at the stock exchanges. An investor could invest in Sylph Education Solutions IPO for short term listing gain or a long term.
Read the Sylph Education Solutions IPO recommendations by the leading analyst and leading stock brokers.
Sylph Education Solutions IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the Sylph Education Solutions IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts mentioned in the above answer to "How is Sylph Education Solutions IPO?"
Our recommendation for Sylph Education Solutions IPO is to avoid.
As per the analysis by our lead analyst Mr. Dilip Davda, we suggest you to avoid the Sylph Education Solutions IPO.
The Sylph Education Solutions IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit Sylph Education Solutions IPO allotment status to check.
