Sati Poly Plast Limited

Sati Poly Plast Limited is an engaged in the manufacturing of flexible packaging material which is multifunctional and caters to the packaging requirements of various industries. They provide end-to-end solution for various flexible packaging needs. From 2017, the Company commenced the manufacturing of flexible packaging material. The Company has set up two manufacturing units, of which 'Plant 1' is situated at C44, Phase II, Gautam Budh Nagar – Noida with an installed capacity of 540 tones per month and 'Plant 2' is situated at Plot No. 85 Udhyog Kendra, Noida with an installed capacity of 540 tones per month. The Company has been consistently expanding its business operations by increasing its installed capacity from 250 tonnes per month to 400 tonnes per month in 2018 and to 500 tonnes per month in 2019. The range of packaging solutions span a variety of products in the food and beverage category, including salty snacks, snack bars, dry fruits, confectionery and dry foods. The products are crafted out of an extensive range of industry approved materials such as polyethy. Currently they are working with Pidilite, Adani Wilmar, JVL and have also started vacuum bags for cashews. As on March 31, 2024, they have the total 135 On Roll Employees. As per financial performance, Sati Poly Plast Limited has posted total income / net profits of Rs 175.22 Cr / Rs 0.28 Cr (FY22), Rs 190.96 Cr / Rs 3.08 Cr (FY23) and Rs 179.40 Cr / Rs 3.28 Cr (FY24). So as per previous financials data, company has shown zig-zag results. Company has posted an average EPS of Rs 4.93 and average RoNW of 26.73% for last three fiscals. Issue is priced at a P/BV of 3.58 as per NAV of 36.29 as on 31.03.24. If we attribute latest earnings of FY22, FY23 and FY24 on fully diluted equity post issue, then asking price is at a P/E of around 227.81, 20.82 and 19.57 respectively, which looks fully priced. As per RHP, comparison between listed peers is shown in above table. On BRLM's front, Beeline Capital Advisors Private Limited is associated with this SME IPO and handled 42 SME IPOs in last 3 years. From last 10 SME IPOs, all opened above issue price or at par on the day of listing. As of now from last 10 SME IPOs, one is trading below issue price and remaining are trading above issue price. ( As on 10.07.24 ) As per financials, Sati Poly Plast Limited has shown good growth, RoNW is 26.71% and P/E is respectively 227.81, 20.82 and 19.57 as per FY22, FY23 and FY24 earnings. So, issue looks fully priced. Company is engaged in the business of flexible packaging material, which is highly fragmented and competitive business segment. Performance of BRLM is good. So, we give "SUBSCRIBE FOR LISTING GAINS" rating for this IPO. Readers must consult a qualified financial advisor prior to making any actual investment decisions.

• 1 Mr. Balmukund Jhunjhunwala
• 2 Mr. Aditya Jhunjhunwala
• 3 Mr. Keshav Jhunjhunwala
• 4 Mrs. Anita Jhunjhunwala
• 5 Balmukund Jhunjhunwala (HUF)