Started in 2000, Sheetal Cool Products Ltd is currently involved in producing and processing of milk and milk products, snacks and bakery items. They sell their products under the brand name 'Sheetal' to a number of distributors and super stockists. Currently, company has a manufacturing unit spread over an area admeasuring around 5314.66 square meters (approximately) at Amreli, Gujarat. SCPL is ISO 22000:2005 & ISO 9001:2015 certified in respect of manufacture of Ice-cream, milk & milk products, mango ras, lassi, curd, flavoured milk, masko, wafers, namkeen, fryums and bakery products. SCPL has wide range of products as mentioned below:1. Milk and Milk product: Their milk and milk portfolio of products comprises of ice cream, pasteurized milk, flavoured milk, yoghurt, lassi, chaas, sweets and many more.2. Snacks: Their snacks portfolio of products comprises of potato chips, banana chips, extruded snacks (fryums), other namkeen including bhujia, salted peanuts, salted pulses and many more.3. Bakery: Their bakery portfolio of products comprises of variety of breads, pav, khari, cake and many more. On performance front, KFSL has posted turnover/net profits of Rs. 6.44 cr. / Rs. - (0.96) cr. (FY14), Rs. 44.90 cr. / Rs. 0.13 cr. (FY15), Rs. 125.28 cr. / Rs. 1.96 cr. (FY16) and Rs. 154.63 cr. / Rs. 2.06 cr. (FY17). For three months ended on 30.06.17 of the current fiscal, it has reported net profit of Rs. 0.58 cr. on a turnover of Rs. 49.35 cr. Thus, company has shown good growth. It has posted an average EPS of Rs. 3.47 and average RoNW of 25.08% for last three fiscals. Issue is priced at a P/BV of 4.56. If we annualize latest earnings of FY18 and attribute it on fully diluted equity post issue, then asking price is at a P/E of 36. As per offer documents, the peers are trading well above P/E of 45 and industry average is 60. Thus issue looks fully priced. On merchant banker’s front, this is 19th IPO in last three fiscals. Out of recent 10 listings, 3 opened at discount to offer price, 2 at par and the rest giving 1 to 20% premium to offer price. As per financials, company's growth is good, RoNW is 25.08% for last three fiscals and issue is fully priced. So we give NEUTRAL rating to this SME IPO.
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