Review By on September 22, 2015
Vaksons Automobiles Ltd (VAL) is an authorised dealer of Light Commercial Vehicles (LCV), Multi-Utility Vehicles (MUV), Small Commercial Vehicles (SCV Vehicles) and spare parts for Force Motors Ltd. It currently operates three different showrooms of Force Motors Ltd., namely at Sonepat, Panipat and Gohana within the state of Haryana. VAL also operates an in-house service centre / workshop at Sonepat for the servicing and other after-sales needs of our clients. The company now mulls multi brand service centre and plans to have trading in auto parts, HDPE/LDPE polymer, aluminium scrap etc through its subsidiary.
For setting up Vehicle Service Centre at Sonepat, invest in its subsidiary Vaksons Metaplast and to meet its working capital needs, the company is coming out with a maiden IPO of 2400000 equity share of Rs. 10 each at a fixed price of Rs. 26 per share to mobilize Rs. 6.24 crore. Issue opens for subscription on 28.09.15 and will close on 01.10.15. Minimum application is to be made for 4000 shares and in multiples thereon, thereafter. Post issue its current paid up equity capital of Rs. 4.18 crore will stand enhanced to Rs. 6.58 crore. Its entire paid up equity till date has been issued at par. Lead managers to the issue are BCB Brokerages Pvt Ltd and Aryaman Financial Sercives Ltd. Cameo Corporate Services Ltd is the registrar to the issue. Post allotment, shares will be listed on BSE SME.
On performance front, for last three fiscals the company has posted an average EPS of Rs. 2.65 with inconsistency records. Its turnover and net profits for last three fiscals were Rs. 12.05 cr. /Rs. 0.03 cr. (FY13), Rs. 14.21 cr. / Rs. 0.11 cr. (FY14) and Rs. 16.25 cr. / Rs. 0.18 cr. (FY15). For FY as its equity has jumped many folds, its EPS stands at Rs. 0.43 and it we attribute said earnings on fully diluted equity of Rs. 6.58 crore then EPS will be around Rs. 0.27 and thus asking price is at a 96 plus making it an aggressively priced IPO. It has not mentioned of its listed peers in prospectus, but has informed about composite P/E at 65 for the industry.
On merchant banker’s front, they have poor track records for their past mandates.
This aggressively priced offer may be given a miss.
Review By on September 22, 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 Vaksons Automobiles Ltd. offers an early investment opportunity in Vaksons Automobiles Ltd.. A stock market investor can buy Vaksons Automobiles IPO shares by applying in IPO before Vaksons Automobiles Ltd. shares get listed at the stock exchanges. An investor could invest in Vaksons Automobiles IPO for short term listing gain or a long term.
Read the Vaksons Automobiles IPO recommendations by the leading analyst and leading stock brokers.
Vaksons Automobiles IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the Vaksons Automobiles IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts mentioned in the above answer to "How is Vaksons Automobiles IPO?"
Our recommendation for Vaksons Automobiles IPO is to avoid.
As per the analysis by our lead analyst Mr. Dilip Davda, we suggest you to avoid the Vaksons Automobiles IPO.
The Vaksons Automobiles IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit Vaksons Automobiles IPO allotment status to check.
