Jiwanram Sheoduttrai Industries Limited

As per financial performance, Jiwanram Sheoduttrai Industries Limited has posted total income/net profits of Rs 32.81 Cr / Rs 0.02 Cr (FY21) and Rs 34.14 Cr / Rs 1.49 Cr (FY22) and Rs 45.98 Cr / Rs 4.02 Cr (FY23), So company has shown good results, but sudden rise in bottom-line before IPO is very surprising. Company has posted an average EPS of Rs 1.45/- and average RoNW of 0.05% for last three fiscals. Issue is priced at a P/BV of 0.87 as per NAV of Rs 26.3/- as on post issue. As per FY22 earnings on fully diluted equity post issue, asking price is at P/E of around 38.03 and as per FY23 earnings P/E is 14.14. As per RHP, there are no peers. On BRLM's front, Affinity Global Capital Market Private Limited is associated with this SME IPO and handled 1 SME IPOs in last 4 years. From last 1 IPO, opened at par of issue price on the listing day. As of now from last 1 IPO, one is trading below issue price. ( As on 06.09.23 ) As per financials, Jiwanram Sheoduttrai Industries Limited has shown good results, RoNW is 0.08% and P/E is respectively 38.03 and 14.14 as per FY22 and FY23 earnings. As per FY22 earnings issue looks aggressively priced and as per FY23 earnings issue looks fully priced. So sudden rise in net profit is very surprising. Company is in business of manufactures and exports Industrial Safety Gloves and Garments, which is highly fragmented and competitive segment with good growth opportunity. Also issue expenses are around 15% of issue size, which is very high for such small SME IPO. BRLM has handled very limited IPOs. So we are giving AVOID rating to this SME IPO. Readers must consult a qualified financial advisor prior to making any actual investment decisions.

• 1  Alok Prakash
• 2 Anupama Prakash
• 3 Gyan Prakash
• 4 Alok Prakash HUF