K K Silk Mills Limited is engaged in the business of manufacturing of fabrics as well as garments. The range of garment products covers all the age group segments such as kids wear, men’s wear, women’s wear. They use variety of knitted fabrics such as 100% cotton, 100% polyester, blended (cotton and polyester) and printed polyester fabrics in the production of garments. They manufacture the fabric which used in variety of products such as mens shirts wear - formal and casual wear, shervani material, ladies wear - dress material, burkha material, kushan cover material etc. They sell the knitted fabrics to domestic and international garment manufacturers. They have approximately 5422 sq. mtrs. size area manufacturing plant located at Umbergaon, Valsad. As on March 31, 2025 company has the total 191 Employees, includes 26 employees working on Contract basis. As per financial performance, K K Silk Mills Limited has posted total income / net profits of Rs 189.28 / 1.06 Cr (FY23), Rs 191.37 / Rs 2.26 Cr (FY24), Rs 221.42 Cr / 4.68 Cr (FY25) and Rs 54.51 Cr / 1.51 Cr (upto Q1 FY26). So as per previous financials data, company has shown steady growth, but sudden rise in net-profit just before IPO raises doubts. Also trade receivable is around 24% of FY25 total revenue. Company has an average EPS of Rs 2.19 and average RoNW of 8.56% for last three fiscals. Issue is priced at a P/BV of 1.38 as per NAV of Rs 27.60/- as on 30.06.25. If we attribute latest earnings of FY24, FY25 and annualised FY26 on equity post issue, then asking price is at a P/E of around 37.10, 18.21 and 14.08 respectively. As per RHP, comparison between listed peers is shown in above table. On BRLM's front, Axial Capital Private Limited is associated with this SME IPO, and has not handled any SME / Main board IPOs in last three fiscal years. ( As on 21.11.25 ) As per financials, K K Silk Mills Limited has shown steady growth, RoNW is 11.7% and P/E is 37.10, 18.21 and 14.08 respectively as per FY24, FY25 and annualised FY26 earnings. So issue looks fully priced, but sudden rise in net profit just before IPO raises doubts. Trade receivables is around 24% of FY25 total revenue and inventory is also high. Company is engaged in the business of manufacturing of fabrics as well as garments, which is highly competitive business segment. BRLM is very new. So, we give AVOID rating for this IPO. Readers must consult a qualified financial advisor prior to making any actual investment decisions.
✍️ Post a Comment