Kore Digital Limited

As per financial performance, Kore Digital Limited has posted total income/net profits of Rs 0.88 Cr / Rs 0.02 Cr (FY20), Rs 3.98 Cr / Rs 0.26 Cr (FY21), Rs 16.94 Cr / Rs 2.18 Cr (FY22) and Rs 11.96 Cr / Rs 2.54 Cr (9M FY23), So company has shown good results, but the sudden rise in net profit just before IPO is very surprising. Company has posted an average EPS of Rs 1179.32/- and average RoNW of 72.24% for last three fiscals. Issue is priced at a P/BV of 2.75 as per NAV of Rs 65.51/- post issue. As per FY22 earnings on fully diluted equity post issue, asking price is at P/E of around 29.07 and as per annualised FY23 earnings P/E is 18.71. As per RHP, comparison between listed peers are shown in above table. On BRLM's front, First Overseas Capital Limited is associated with this SME IPO and handled 15 SME IPOs in last 3 years. First Overseas Capital Limited : This is 16th IPO from this BRLM. From last 10 IPOs, one opened below issue price and remaining opened above issue price or at par on the day of listing. As of now, from last 10 IPOs, five are trading below issue price and remaining are trading above issue price or at par. ( As on 02.06.23 ) As Per financials, Kore Digital Limited has shown good results, RoNW is 86.46% and P/E is respectively 29.07 and 18.71 as per FY22 and annualised FY23 earnings, which looks aggressively priced. Also sudden rise in net profit just before IPO raises concerns. Company is in Telecommunication Infrastructure business, which is highly competitive and fragmented, with many players. Performance of BRLM is average. 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 Mr Ravindra Navinchandra Doshi
• 2 Mrs. Kashmira Ravindra Doshi
• 3 Mr. Chaitanya Ravindra Doshi