Mish Designs Limited

As per financial performance, Mish Designs Limited has posted total income/net profits of Rs 4.19 Cr / Rs 0.003 Cr (FY21), Rs 7.30 Cr / Rs 0.05 Cr (FY22), Rs 11.11 Cr / Rs 0.60 Cr (FY23) and Rs 2.27 Cr / Rs 0.11 Cr (Upto Q1 FY24). So company has shown good growth, but sudden rise in net-profit just before IPO, is very surprising. Company has posted an average EPS of Rs 2.98/- and average RoNW of 17.15% for last three fiscals. Issue is priced at a P/BV of 2.83 as per NAV of Rs 43.05/- as on post issue. As per FY22, FY23 and annualised FY24 earnings on fully diluted equity post issue, asking price is at P/E of respectively around 644.53, 56.28 and 75.58. As per RHP, comparison between listed peers is shown in above table. On BRLM's front, Aryaman Financial Services Limited is associated with this SME IPO and handled 17 SME IPOs in last 3 years. From last 10 IPO, one opened below issue price and remaining opened at par or above issue price on the listing day. As of now from last 10 IPO, four are trading below issue price and remaining are trading above issue price. ( As on 27.10.23 ) As per financials, Mish Designs Limited has shown good results, RoNW is 27.86% and P/E is respectively 644.53, 56.28 and 75.58 as per FY22, FY23 and annualised FY24 earnings. So, issue looks aggressively priced. But, sudden rise in net-profit and higher issue expenses are very surprising. Company is in business of processing fabric into garments, which is highly fragmented and competitive segment. Performance of BRLM is good. 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  Kaushal Goenka
• 2  Sajan Bhartia