Brief Summary
Alright folks, this YouTube video by Sunday Investing is all about breaking down the IPO scene for the first week of July. They're looking at a whopping 16 IPOs, both mainboard and SME, and giving their unbiased opinions to help you decide where to park your money. They cover a bunch of companies, from logistics and auto components to hotels and jewelry, giving you the lowdown on financials, growth potential, and whether they think it's worth applying.
- Review of 16 IPOs (Mainboard and SME)
- Unbiased opinions on company financials and growth
- Focus on helping viewers make informed investment decisions
Opening Remarks
The Sunday Investing crew is all here to discuss the crazy number of IPOs hitting the market this week. They're talking 16 IPOs, a mix of mainboard and SME, and they know everyone's got limited funds, so they're gonna help you figure out which ones to prioritize. They're planning to cover all the mainboard IPOs and the bigger SME ones, but they also want to know which SMEs you're interested in. They're gonna chat about Brigade Hotels and Shanti Gold from the mainboard side, and Repono Logistics, Sellowrap Industries, and Patel Chem Specialties from the SME side. Just a heads up, they're not SEBI registered, so this is just friendly advice, not qualified opinions. Do your own research before you invest!
Repono Logistics (SME)
Repono Logistics, started in 2017, is in the warehousing and logistics game, specializing in storage for the oil and petrochemical sectors. They offer warehousing, transportation, and logistics support. It's a ₹27 crore IPO, all fresh issue, with a market cap of ₹99 crore. They're diluting about 26.5%. Financials look decent, but the IPO's coming at a PE of 19-20, which seems a bit high for a plain vanilla logistics company. Sachin jumps in to explain that Repono focuses on specialized warehousing for solids and liquids, with experienced folks at the helm. They use an asset-light model, leasing warehouses and securing contracts with volume guarantees. Clients include big names like IOCL and HPCL. They're expanding into specialty chemicals and targeting overseas markets. Safety is a big deal for them, with zero lost time injuries. The IPO proceeds will go towards equipment and upgrading their warehouse management system. While there are risks like handling hazardous materials and competition, the pricing seems decent, with some value left on the table for investors.
Sellowrap Indusries (SME)
Sellowrap Industries, around since 1983, makes components for the automotive and white goods sectors. They've got four manufacturing units and offer products like plastic injection molding parts. It's a ₹30 crore IPO, all fresh issue, with a market cap of ₹114 crore, diluting about 26%. Financials look good, and the company seems valued reasonably, coming at a PE of around 11.5. Tanby shares that Sellowrap specializes in customized components for both automotive and non-automotive industries, supplying to OEMs and tier 1 and tier 2 customers. They source most of their raw materials from India and export to several countries. The company's been generating consistent positive cash flows, and return ratios are expanding. Valuations look good compared to peers, but growth has been slow. A significant portion of their turnover comes from their top 10 customers. The issue looks decent, but it depends on how the market values the injection molding business. They're planning to use the IPO proceeds to establish plant and machinery for higher-value products.
Shree Refrigeration (SME)
Shree Refrigeration, started in 2006, manufactures HVAC systems, including chillers and condensing units. They serve sectors like automotive, marine, and pharmaceuticals. This IPO is a hot one, with a lot of demand. It's a ₹117 crore IPO, with ₹94 crore fresh issue and ₹23 crore OFS, with a market cap of ₹445 crore. The company's coming at a PE of 33, which is pretty high. Rohit explains that Shree Refrigeration sits at the intersection of defense and HVAC, two high-multiple segments. They focus on marine chillers for ships, including navy ships, and have the necessary approvals and certifications. Their HVAC systems are designed to cool equipment and warfare systems in challenging marine environments. They have specific registrations and approvals from the Ministry of Defence. The company's largest client is Mazagon Dock, and they have a strong order book. They're raising funds to support their working capital. The promoter is passionate about making manufacturing in India reliable. The company has a strong board with ex-army personnel. While there are no direct peers, the company's valuation looks cheap compared to others in the defense and HVAC space.
Brigade Hotels (Mainboard)
Brigade Hotels, a subsidiary of Brigade Enterprises, owns and develops hotels primarily in South India. They have nine operating hotels across several cities, with tie-ups with Marriott, Accor, and Intercontinental. It's a ₹760 crore IPO, all fresh issue, with a market cap close to ₹3,400 crore. Only 10% is for retail investors. The aim of the IPO is to repay debt. Tanby shares that Brigade Hotels operates in the upscale to upper midscale segments. They have an average room revenue of ₹6,700 with an occupancy of around 77%. The IPO proceeds will be used to repay debt and acquire land from the promoter. The company has several properties in the pipeline. Financials show revenue growth, but the company is not commencing any additional property in FI26 or even FI27. Valuations seem pricey compared to peers like Indian Hotels and EIH. The company has the second-lowest cost of borrowing in the industry.
Patel Chem Specialties (SME)
Patel Chem Specialties, started in 2008, manufactures and exports pharmaceutical excipients and specialty chemicals. These chemicals are used in pharmaceuticals, foods, and cosmetics. It's a ₹59 crore IPO, all fresh issue, with a market cap of ₹209 crore, diluting about 30%. Financials look good, but the company seems fully valued. Sachin explains that Patel Chem is led by a chemical engineer with 25 years of experience. They export to 15 countries and have a USFDA approval for their plant. Their revenue mix is diversified into various chemicals. They're expanding their plant and setting up a third facility. The gestation period for the new facility is long. They don't have long contracts but maintain a 60-day inventory. The company is targeting 20-25% growth in FI26. The pricing is at par.
Shanti Gold (Mainboard)
Shanti Gold, started in 2003, manufactures gold jewelry and is a B2B player. It's a ₹360 crore IPO, all fresh issue, with a market cap of ₹1435 crore. Financials look good, with growing revenue and profit. Tanby shares that Shanti Gold manufactures 22-karat CZ casting gold jewelry for companies like Joyalukkas and Alukkas. They have operations in 15 states and two union territories, with most of their revenue coming from South India. The company is setting up a new facility in Jaipur. They have a non-compete agreement with Utsav, a listed company owned by the same promoter. Valuations seem decent compared to peers like Sky Gold. The IPO is small, so bigger funds might not take much interest.
Closing Remarks
The Sunday Investing crew wraps up the session, highlighting that it's been a long one. They'll be back with a part two to cover the remaining mainboard IPOs and discuss some more SME raises. They thank everyone for joining and remind you to subscribe to their YouTube channel.
