Sadhav Shipping Limited

Sadhav Shipping Limited (SSL) - Mumbai based company incorporated in year 1996 with an objective to own and operate marine assets to service ports, coastal logistics and other port maritime related services. Today SSL owns and operates 24 vessels that includes 19 owned vessels and 5 rented vessels, in various sectors of maritime trade in India. Sadhav Shipping Limited was incorporated by Mr. Kamal Kant Biswanath Choudhury an alumnus of T.S. Dufferin and Master Mariner. He is also an alumni of NMIMS and a Gold Medallist Fellow of Narottam Morarjee Institute of Shipping. He worked with the Directorate General of Shipping (India) and ONGC Ltd prior to founding the Sadhav Shipping Limited. Sadhav Shipping Limited has developed strong customer base in the sector and is providing its services to leading companies which includes ONGC Ltd., Mumbai Port Authority, Paradip Port Authority, Bhabha Atomic Research Centre, Shipping Corporation of India, New Mangalore Port Authority, Deendayal Port Authority (Kandla/Vadinar), Jawaharlal Nehru Port Authority (JNPA ), BPCL, Gujarat Police, JSW Ports and more. Sadhav Shipping Limited was the first to setup and operate India’s first Port based Tier 1 Oil Spill Response Facility Centre in Mumbai and are now operating in most of the Major Ports in India. With a sailing team of 200+ officers and crew coupled with effective and experienced shore management; they are witnessing sustainable growth year on year. As per financial performance, Sadhav Shipping Limited has posted total income / net profits of Rs 61.24 Cr / Rs 3.31 Cr (FY21), Rs 69.78 Cr / Rs 3.01 Cr (FY22), Rs 78.91 Cr / Rs 7.75 Cr (FY23) and Rs 33.86 Cr / Rs 4.07 Cr (upto Q2 FY24). So as per previous financials data, company has shown average growth, but sudden rise in net-profit just before IPO is very surprising. Company has posted an average EPS of Rs 5.25 and average RoNW of 14.05% for last three fiscals. Issue is priced at a P/BV of 1.64 as per NAV of 57.96 as on post issue. If we attribute latest earnings of FY22, FY23 and annualised FY24 on fully diluted equity post issue, then asking price is at a P/E of around 45.31, 17.58 and 16.75 respectively, which looks fully priced. As per RHP, comparison between listed peers is shown in above table. On BRLM's front, ISK Advisors Private Limited is associated with this SME IPO and handled 5 SME IPOs in last 3 year. From last 5 SME IPOs, all opened above issue price or at par on the day of listing. As of now from last 5 SME IPOs, all are trading above issue price. ( As on 19.02.24 ) As per financials, Sadhav Shipping Limited has shown average growth, RoNW is 18.94% and P/E is respectively 45.31, 17.58 and 16.75 as per FY22, FY23 and annualised FY24 earnings. So, issue looks fully priced, but sudden rise in net-profit generates some doubts. Company is engaged in operating marine assets including logistics and other port related services, which is highly competitive and fragmented segment. The sector is expected to grow at good rate. Performance of BRLM is good. So, we give SUBSCRIBE rating for this IPO. Readers must consult a qualified financial advisor prior to making any actual investment decisions.

• 1 Mr. Kamal Kant Biswanath Choudhury
• 2 Mrs Sadhana Choudhury
• 3 Mr. Vedant Kamalkant Choudhury
• 4 Mr. Subhas Chandra Choudhury