Review By on February 27, 2018
Uniinfo Telecom Services Ltd. (UTSL) is providing services for Network Survey and Planning, Installation and Commissioning, Network Testing and Optimization, In Building Solutions and Wi-Fi and Managed Services for network maintenance. Its strong technical background enables company to effectively carry out end-to-end services thereby covering the entire Network Roll out map. UTSL provides services to telecom industry players ranging from telecom equipment manufacturers (OEM’s) to telecom operators. It offers support services and solutions to address the Network Life Cycle requirements of Telecom industry.
To part finance its debt repayments, working capital and general corpus fund needs, UTSL is coming out with a maiden IPO of 3638000 equity shares of Rs. 10 each at a fixed price of Rs. 55 per share to mobilize Rs. 20.01 crore. Issue opens for subscription on 05.03.18 and will close on 07.03.18. Minimum application is to be made for 2000 shares and in multiples thereon, thereafter. Post allotment, shares will be listed on NSE SME Emerge. Issue is solely lead managed by Systematix Corporate Services Limited and Link Intime India Pvt. Ltd. is the registrar to the issue. Company has reserved 804000 shares for pre-IPO placement and thus the net public issue is for 2834000 shares valued at Rs. 15.59 crore. Issue constitutes 26.50% of the post issue paid up capital of the company. Having issued initial equity at par, it raised further equity in the price range of Rs. 125 to Rs. 235 per share. It has also issued bonus shares in the ratio of 15 for 1. It has raised Rs. 4.42 crore under pre-IPO placement of 804000 shares at Rs. 55 per share in February 2018. Post issue its current paid up capital of Rs. 7.06 crore will stand enhanced to Rs. 10.69 crore. Average cost of acquisitions of shares by the promoters is Rs. 4.19, Rs. 11.25 and Rs. 12.68 per share.
On performance front, UTSL has posted turnover/net profits of Rs. 1.51 cr. / Rs. 0.01 cr. (FY14), Rs. 6.23 cr. / Rs. 0.10 cr. (FY15), Rs. 14.31 cr. / Rs. 0.23 cr. (FY16) and Rs. 27.90 cr. / Rs. 1.08 cr. (FY17). It has earned net profit of Rs. 2.16 cr. on a turnover of Rs. 17.02 cr. for first half of the current fiscal. For last three fiscals it has posted an average EPS of Rs. 97.02 and an average RoNW of 52.08% on an equity base of Rs. 0.23 crore that is swelling to Rs. 10.69 crore post issue. Issue is priced at a P/BV of 0.17 on the basis of its NAV of Rs. 316.88 as on 30.09.17 and at a P/BV of 1.96 on the basis of its post issue NAV of Rs. 28.13. If we annualize latest earnings and attribute it on fully diluted equity post issue, then asking price is at a P/E of 13 plus. It has no listed peers to compare with.
On merchant banker’s front, this is the 3rd mandate from its stable in last three years. Last 2 listings opened at a premium ranging from 16% to 20% on the listing day.
Although company’s track record is impressive, sudden rise in equity from Rs. 0.23 crore to Rs. 10.69 crore raises concern. Moderate investment may be considered for long term
Review By on February 27, 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 Uniinfo Telecom Services Ltd. offers an early investment opportunity in Uniinfo Telecom Services Ltd.. A stock market investor can buy Uniinfo Telecom IPO shares by applying in IPO before Uniinfo Telecom Services Ltd. shares get listed at the stock exchanges. An investor could invest in Uniinfo Telecom IPO for short term listing gain or a long term.
Read the Uniinfo Telecom IPO recommendations by the leading analyst and leading stock brokers.
Uniinfo Telecom IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the Uniinfo Telecom IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts mentioned in the above answer to "How is Uniinfo Telecom IPO?"
Our recommendation for Uniinfo Telecom 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 Uniinfo Telecom IPO.
The Uniinfo Telecom IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit Uniinfo Telecom IPO allotment status to check.
