SVS Ventures Limited

SVS Ventures Limited, is engaged in development of real estate projects in the residential segment comprising apartment type complexes, villas, largely catering to the middle income and high income group. SVS Ventures Limited projects are broadly classified as follows:Company Projects are marketed and sold under the brand name of “SVS Ventures (formerly known as Vijay & co.)”.1) Residential Projects: These projects cover Bungalows and Villas.2) Commercial Projects: These projects include construction of commercial offices and shop. The company revenue from operations in FY22 is Rs 868.27 lakhs and Profit After Tax in FY22 is Rs 183.37 lakhs. As of July 31, 2022, they have 29 employees on payroll As per financial performance, SVS Ventures Limited has posted total income/net profits of Rs 13.48 Cr / Rs 0.25 Cr (FY20), Rs 13.55 Cr / Rs 0.27 Cr (FY21), Rs 8.68 Cr / Rs 1.83 Cr (FY22) and Rs 1.30 Cr / Rs 0.14 Cr (upto Q1 FY23). So company has shown inconsistent result. Company has posted an average EPS of Rs 7.24 and average RoNW of 319.18% for last three fiscals. Issue is priced at a P/B of 1.31 as per NAV of Rs 15.23 post issue. As per FY22 earnings on fully diluted equity post issue, asking price is at P/E of around 23.29 and as per annualised FY23 earnings P/E is 74.44. As per RHP, listed peers are shown in above table. On BRLM's front, First Overseas Capital Limited associated with this SME IPO and handled 13 SME IPOs in last 4 years. From last 10 IPO 1 is opened below issue price and remaining are opened above issue price or at par. As of now from last 10 IPOs, four are trading below and remaining are trading above issue price or at par. ( As on 28.12.22 ) As per financials SVS Ventures Limited, has shown good results, RoNW is 69.32% and P/E is respectively 23.29 and 74.44 as per FY22 and annualised FY23 earnings, which looks aggressively priced. Company is in real estate business which is very competitive and fragmented. Performance of BRLM is average post listing. So we are giving AVOID rating to this SEM IPO.

• 1 Mr. Shashikant Sharma