Mangal Compusolution Limited

Mangal Compusolution Limited is engaged in delivering comprehensive IT hardware solutions designed to meet the ever-evolving technology needs of businesses across various industries. They are actively involved in the business of renting and selling IT hardware equipment, offering comprehensive end-to-end IT equipment. Although they are servicing clients across India, however, Maharashtra region accounts for the major source of revenue, for the quarter ended June 30, 2024, Maharashtra region accounted for 96.87% of the total revenue. The services encompass the rental of a diverse range of IT equipment, including servers, laptops, desktops, projectors, router-switches, workstations, Plasma/LCD TVs, PA Systems, and various accessories. Additionally, they specialize in creating customized IT configurations tailored to the clients' specific specifications and needs, available for both rental and purchase.etc. The rental services offer businesses the flexibility to scale their IT infrastructure as needed. They cater to both small as well as large enterprises, the IT hardware products, including laptops, desktops, servers, and other IT equipment, can be tailored to meet specific requirements of the clients. This scalability allows the clients to adapt to changing workloads, seasonal demands, or project-specific needs without the burden of long-term hardware ownership. To simplify this process, they provide on-site setup and deployment services. Company's IT equipment sales represented 0.08%, 2.40%, 14.85%, and 6.92% for the period Q1 FY25, FY24, FY23 and FY22, respectively. As per financial performance, Mangal Compusolution Limited has posted total income / net profits of Rs 18.49 Cr / Rs 0.87 Cr (FY22), Rs 34.83 Cr / Rs 7.04 Cr (FY23), Rs 23.44 Cr / Rs 3.86 Cr (FY24) and Rs 4.53 Cr / Rs 0.81 Cr (Q1 FY25). So as per previous financials data, company has shown zig-zag results. Company has posted an average EPS of Rs 4.42 and average RoNW of 25.79% for last three fiscals. Issue is priced at a P/BV of 1.65 as per NAV of 27.22 as on post issue. If we attribute latest earnings of FY23, FY24 and annualised FY25 on fully diluted equity post issue, then asking price is at a P/E of around 8.7, 15.87 and 18.90 respectively, which looks fully priced. As per RHP, comparison between listed peers is shown in above table. On BRLM's front, Jawa Capital Services Private Limited is associated with this SME IPO and handled 3 SME IPOs in last 3 years. From last 3 IPOs, two opened below issue price and remaining opened above issue price or at par on the day of listing. As of now from last 3 IPOs, two are trading below issue price and remaining is trading above issue price as on today. ( As on 07.11.24 ) As per financials, Mangal Compusolution Limited has shown zig-zag results, RoNW is 19.29% and P/E is respectively 8.7, 15.87 and 18.90 as per FY23, FY24 and annualized FY25 earnings. So, issue looks fully priced. Company is engaged in delivering comprehensive IT hardware solutions, which is highly competitive and fragmented business segment. Performance of BRLM is very poor. So, we give AVOID rating for this IPO. Readers must consult a qualified financial advisor prior to making any actual investment decisions.

• 1 Mr. Hardik Meghraj Jain
• 2 Mrs. Neeta Mukesh Desai
• 3 Mr. Pathik Mukesh Desai
• 4 Mr. Mukesh Khandubhai Desai
• 5 Mrs. Binny Pathik Desai