Bombay Metrics Supply Chain Limited

Bombay Metrics Supply Chain Limited, started in 2015, is a full-service provider of manufacturing of engineered goods and supply chain management services. They also offer efficient services in advanced engineering, 3D scanning, rapid prototyping, flow simulation, project management and quality management. Company helps the customers find the right manufacturing source in India for their products and ensure optimal execution and quality by working with qualified and ISO-certified suppliers. They oversee the operations, manage supply chain process and choose the right logistics partners to be close to ports connecting them to the customer locations. On the financial performance front, BMSCL reported turnover/net profits (loss) of Rs. 7.63 Cr. / 0.43 Cr. (FY18), Rs. 20.02 Cr./ 0.93 Cr. (FY19), Rs. 29.93 Cr / 1.39 Cr. (FY20) and Rs. 32.41 Cr. / 1.30 Cr. (FY21). So company has shown improvements in results. But company's major revenue comes from only one client (more than 90%). For the last 3 years, company has posted average EPS of Rs.11.84 and RoNW of 56.12%. The issue is priced at a P/BV of 1.69 based on its NAV of Rs. 54.88 post issue. As per FY21 earnings and on post issue equity, IPO is valued at P/E of around 11, which looks reasonably priced. As per RHP, there is no listed peers. On BRLM's front, Unistone Capital Private Limited associated with this SME IPO and handled 4 IPOs in last 3 years. From last 4 IPOs, one opened below issue price and remaining above issue price. As of now from 4 IPOs, three are trading below and remaining are trading above issue price or at par. (As on 28.09.21 ) For BMSCL, financials are improving, RoNW is 37.71% and P/E is around 10.99 for FY21, so issue looks reasonably priced. But only concern is company's over dependence on one client, which may be harmful in future. Performance of BRLM is poor. So we give NEUTRAL rating to this SME IPO.

• 1  Nipul Hirji Keniya
• 2 Hiten Talakchand Shah