Sunrest Lifescience Limited

As per financial performance, Sunrest Lifescience Limited has posted total income/net profits of Rs 16.94 Cr / Rs 0.16 Cr (FY21), Rs 26.90 Cr / Rs 0.77 Cr (FY22), Rs 24.67 Cr / Rs 2.04 Cr (FY23) and Rs 5.63 Cr / Rs 0.75 Cr (Upto Q1 FY24). So company has shown sudden growth in net profit just before IPO, that is very surprising and trade receivables are around 44% of FY23 sales. Company has posted an average EPS of Rs 4.36/- and average RoNW of 66.31% for last three fiscals. Issue is priced at a P/BV of 2.45 as per NAV of Rs 34.28/- as on post issue. As per FY22, FY23 and annualised FY24 earnings on fully diluted equity post issue, asking price is at P/E of respectively around 46.39, 17.64 and 12.02. As per RHP, comparison between listed peers is shown in above table. On BRLM's front, Mark Corporate Advisors Private Limited is associated with this SME IPO and handled 2 SME IPOs in last 3 years. From last 2 IPO, all opened above issue price or at par on the listing day. As of now from last 2 IPO, all are trading above issue price. ( As on 01.11.23 ) As per financials, Sunrest Lifescience Limited has shown average results, RoNW is 65.59% and P/E is respectively 46.39, 17.64 and 12.02 as per FY22, FY23 and annualised FY24 earnings. So, issue looks fully priced. But, sudden rise in net profit and higher trade receivables are some concerns. Company is in business of healthcare and personal care products, which is highly fragmented and competitive segment. So we are giving AVOID rating to this SME IPO. Readers must consult a qualified financial advisor prior to making any actual investment decisions.

• 1  Mr. Nikhilkumar Y Thakkar
• 2  Mr. Amitbhai Shambhulal Thakkar
• 3  Mr. Bhagyesh Kiritbhai Parekh
• 4  Mr. Bharatkumar V Thakkar