Uma Exports Limited

Uma Exports Limited was initially engaged in the business of export of building materials i.e. marble, granite, marble chips and other construction materials to the neighbouring country, Bangladesh. Keeping in view the demand in Bangladesh market the Company diversified from export of building materials to export of agricultural produce and commodities in the year 1997. Since then, Company has been engaged in exporting agricultural produce and commodities including rice, wheat, sugar and spices. They have explored the business opportunities in Malaysia and Sri Lanka in addition to Bangladesh during these years. The Company is engaged into trading and marketing of agricultural produce and commodities such as sugar, spices like dry red chillies, turmeric, coriander, cumin seeds, food grains like rice, wheat, corn, sorghum and tea, pulses and agricultural feed like soybean meal and rice bran deoiled cake. They import lentils, faba beans, black urad dal and tur dal in India in bulk quantities. Company's major imports are from Canada, Australia and Burma. They are B2B traders, highly specialized in sugar, corn and dal. They maintain stocks and distribute them to different institutional parties like manufacturers, exporters, etc.They provide them in bulk quantities.. Company has a strong presence in agro commodities trading segment thereby enabling it to strategise and switch over exports/imports from one commodity to another in accordance with change in demand or inconsistency in pricing for any commodity during any season. Company's senior management team continuously monitors and undertakes deep research of the current trends and demand of agricultural produce and commodities in the market and accordingly it easily switches over to the agricultural produce or commodity in demand. This policy adopted by the management ensures that the Company does not pass through a lean period during the year.. As per financial performance, Uma Exports Limited has posted total income/net profits of Rs 329.37 Cr / Rs 2.88 Cr (FY19), Rs 810.30 Cr / Rs 8.32 Cr (FY20), Rs.752.02 Cr  / Rs 12.18 Cr (FY21) and Rs. 523.94 Cr / Rs 8.97 Cr (H1 FY22). So company has posted good results and net profits increased multi-fold. They have posted an average EPS of Rs. 3.73 and average RoNW of 14.49% for last three fiscals. Issue is priced at a P/BV of 2.15 as per NAV of 31.60 on 30.09.21. If we attribute latest earnings of FY21 on fully diluted equity post issue, then asking price is at a P/E of around 18.87 and as per FY22 annualised earnings P/E is around 12.81, which looks fully priced. As per RHP, comparison between listed players is shown in above table. On BRLM's front, One lead manager, Corporate Capital Ventures Private Limited, is associated with this IPO, and have handled around 8 IPOs in last three fiscals. From last 8 IPOs, two is opened below issue price and remaining are opened above issue on the day of listing. As of now, two are trading below issue price and other are trading above issue price. ( As on 21.03.22) As per financials, Uma Exports Limited has shown growth, RoNW is 17.67% and P/E is respectively 19 and 13 as per FY21 and annualised FY22 earnings, which looks fairly priced. Company is in trading of different commodities and bulk exporter / importer. There is very high competition in this sector. Performance of BRLM is good. So, we give NEUTRAL rating for this IPO.

• 1 Rakesh Khemka
• 2 Sumitra devi Khemuka