Graphisads Limited

As per financial performance, Graphisads Limited has posted total income / net profits of Rs 47.55 Cr / Rs 0.55 Cr (FY21), Rs 89.72 Cr / Rs 5.58 (FY22), Rs 99.04 Cr / Rs 5.56 Cr (FY23) and Rs 26.02 Cr / Rs 2.06 Cr (upto Q1 FY24). So as per previous financials data, company has shown static results, but sudden rise in net profit in Q1 FY24, just before IPO is very surprising. Company has posted an average EPS of Rs 8.29 and average RoNW of 7.75% for last three fiscals. Issue is priced at a P/BV of 2.81 as per NAV of 39.51 as on Post Issue. If we attribute latest earnings of FY22, FY23 and annualised FY24 on fully diluted equity post issue, then asking price is at a P/E of around 36.35, 36.45 and 24.57 respectively, which looks fully priced. As per RHP, comparison between listed peers is shown in above table. On BRLM's front, First Overseas Capital Limited is associated with this SME IPO and handled 20 SME IPOs in last 3 years. From last 10 IPOs, all opened above issue price or at par on the listing day. As of now from last 10 IPOs, four are trading below issue price and remaining are trading above issue price. ( As on 27.11.23 ) As per financials, Graphisads Limited has shown average result, RoNW is 12.99% and P/E is respectively 36.35, 36.45 and 24.57 as per FY22, FY23 and annualised FY24 earnings. So, issue looks fully priced. Company is an integrated marketing, advertising and communication agency, which is highly competitive and fragmented segment. Performance of BRLM is average post listing. So, we give NEUTRAL rating for this IPO. Readers must consult a qualified financial advisor prior to making any actual investment decisions.

• 1 Mr. Mukesh Kumar Gupta
• 2 Mr. Alok Mukesh Gupta
• 3 Mrs. Padma Mukesh Gupta