Slone Infosystems Limited

Slone Infosystems Limited is an IT hardware solutions Company, engaged in selling and renting of IT Equipment, and in providing IT Service Solutions in India. They deal in selling and renting of IT equipment like laptops, desktops, servers, work stations and also provide IT solution services like managing cloud servers, servicing of IT equipment to the corporates. They provide custom made solutions to the clients for their IT requirements. They procure IT equipment for the clients based on the requirement of the client and then either sell or rent the IT equipment to the clients based on their requirement. They provide flexibility and advantage to acquire the requisite equipment that the client needs to maximize their productivity without compromising their IT budget. In addition, they also sell the used IT equipments to clients as per their requirements.    The Company Business operates in segments, viz. 1. Sale of Laptop, Computer & Computer Peripherals 2. Sale of other IT related products 3. IT Service solutions; and 4. Rental Services As per financial performance, Slone Infosystems Limited has posted total income / net profits of Rs 11.57 Cr / Rs 0.27 Cr (FY21), Rs 26.59 Cr / Rs 0.38 Cr (FY22), Rs 30.77 Cr / Rs 0.74 Cr (FY23) and Rs 34.34 Cr / Rs 2.84 Cr (upto Q3 FY24). So as per previous financials data, company has shown good growth, but sudden increase in net profit, just before IPO generates doubts. Issue is priced at a P/BV of 1.20 as per NAV of 65.6 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 108.65, 55.75 and 10.96 respectively, which looks fully priced. As per RHP, comparison between listed peers is shown in above table. On BRLM's front, Jawa Capital Services Private Limited is associated with this IPO and this is first IPO for the company. As per financials, Slone Infosystems Limited has shown good growth, RoNW is 35.47% and P/E is respectively 108.65, 55.75 and 10.96 as per FY22, FY23 and annualised FY24 earnings. So, issue looks fully priced and sudden rise in net-profit is very surprising. Company is in business of IT hardware solutions, which is highly competitive and fragmented segment. This is first SME IPO from the BRLM. So, we give NEUTRAL rating for this IPO. Readers must consult a qualified financial advisor prior to making any actual investment decisions.

• 1 Mr. Rajesh Srichand Khanna
• 2 Mrs. Manisha Rajesh Khanna
• 3 Mr. Mohit Rajesh Khanna