Shivalic Power Control Limited

Shivalic Power Control Limited is an ISO-certified LT and HT electric panel manufacturer with an operating history of 20 years. The 1,25,000 Sq. Feet of in-house manufacturing unit allowed them to manufacture a diversified range of electric panels such as PCC Panels, IMCC Panels, Smart Panels, MCC Panels, DG synchronisation panels, Outdoor panels, HT Panels up to 33KV, VFD Panels, Power Distribution Boards, Bus Duct and LT & HT APFC Panels. They are authorised by industry leaders such as L&T, Siemens, Schneider Electric and TDK to manufacture fully type-tested panels as per IEC 61439 – 1&2, IEC 61641, IS1893 which they serve to more than 15+ industrial Sectors in India as well as in outside India, viz, Nepal, Bangladesh, African countries such as Uganda, Kenya, Nigeria, Algeria. The company was started in 2004 with Low Voltage Panel assembly with a vision to constantly provide quality products by adapting to the latest technologies. During this journey of two decades, Shivalic has served more than 500+ Clients in different industries such as Sugar, Papers, Cement, Steel, FMCG, Automobile etc. The clientele in this industry includes Hewlett Packard, DCM Shriram, Rungta Mines, Reliance Cement, Kalpataru Power Transmission, Jindal Steel & Power, JSW, Bikaji Foods, Dabur, Radico, Naini Paper, J K Paper, Orient Papers, J K Cement, Escorts, Yamaha Motors and many more. As per financial performance, Shivalic Power Control Limited has posted total income / net profits of Rs 52.38 Cr / Rs 0.67 Cr (FY21), Rs 57.41 Cr / Rs 1.74 Cr (FY22), Rs 82.69 Cr / Rs 7.16 Cr (FY23) and Rs 63.79 Cr / Rs 7.60 Cr (FY24). So as per previous financials data, company has shown average results. But, sudden rise in net-profit is very surprising. Company has posted an average EPS of Rs 2.5/- and average RoNW of 23.10% for last three fiscals. Issue is priced at a P/BV of 5.58 as per NAV of 17.93 as on 31.12.23. If we attribute latest earnings of FY22, FY23 and annualized FY24 on fully diluted equity post issue, then asking price is at a P/E of around 137.97, 33.67 and 23.79 respectively, which looks fully priced. As per RHP, comparison between listed peers is shown in above table. Corporate Capitalventures Private Limited is associated with this SME IPO and handled 12 SME IPOs and 1 Main board IPO in last 3 year. From last 10 SME IPOs, all opened above issue price or at par on the day of listing and From last 1 Main board IPO, that is opened above issue price on the day of listing. As of now from last 10 SME IPOs, all are trading above issue price and From last 1 Main board IPO, that is trading above issue price. (As on 18.06.24) As per financials, Shivalic Power Control Limited has shown average results, RoNW is 36.82% and P/E is respectively 137.97, 33.67 and 23.79 as per FY22, FY23 and FY24 earnings. So, issue looks fully priced, but sudden rise in net-profit is very surprising and higher value of trade receivables generates doubts. Company is an LT and HT electric panel manufacturer, which is highly competitive and fragmented business segment. Performance of BRLM is good. So, we give "SUBSCRIBE FOR LISTING" rating for this IPO. Readers must consult a qualified financial advisor prior to making any actual investment decisions.

• 1 Mr. Amit Kanwar Jindal
• 2 Dr. Sapna Jindal