Aditya Vision Ltd. (AVL) is engaged into retail business of consumer electronics, home appliances, camera, cam recorders, and mobile phones. AVL is a multi-brand, multi-product retail chain which stocks an entire range of consumer durables, right from Air conditioners, TVs, Washing Machines, Refrigerators, Microwaves, Home Theatre Systems, Mobile Phones, small home appliances and many more. It offers some of the popular brands such as LG, Samsung, Sony, Daikin, Videocon, Panasonic, Onida, Nikon etc. Having started its business with a small store in Patna, Bihar, now it has evolved into one of Patna’s leading chain of consumer durables and electronic goods stores. At present it has 19 stores/outlets across Bihar, India under the brand name of “Aditya Vision”.
To meet working capital requirements and raise general corpus funds, the company is coming out with a maiden IPO of 3840000 equity share of Rs. 10 each at a fixed price of Rs. 15 per share. Minimum application is to be made for 8000 shares and in multiples thereon, thereafter. Issue opens for subscription on 28.11.16 and will close on05.12.16. Issue is solely managed by Guiness Corporate Advisors Pvt Ltd and Cameo Corporate Services Ltd is the registrar to the issue. Post allotment, shares will be listed on BSE SME. After initial equity issue at par during 2000-2007 and at par rights issue in March 2016, it issued few shares at a price of Rs. 15 to Rs. 30 per share between 2008- 2013. It has also issued bonus shares in the ratio of 2 for 1 in March 2016. Post IPO its current paid up equity of Rs. 10.27 crore will stand enhanced to Rs. 14.11 crore.
On performance front, the company has posted turnover/net profit of Rs. 124.62 cr. / Rs. 0.73 cr. (FY14), Rs. 179.18 cr. / Rs. 1.13 cr. (FY15) and Rs. 240.71 cr. / Rs. 1.18 cr. (FY16). For first quarter of the current fiscal, it has earned net profit of Rs. 0.54 cr. on a turnover of Rs. 113.11 cr. If we annualize these earnings and attribute on fully expanded equity post IPO then asking price is at a P/E of 9 plus that appears to be reasonable. However, many mega brands are not doing up to the mark in retail chains and company is likely to face competition going forward. As per prospectus, the company has no listed peers to compare with.
On merchant banker’s front, this is the 25th mandate. It has erratic track records for the past as five of its mandate getting suspension from trading.
Conclusion: Cash surplus investors may park funds for long term.
Review By Dilip Davda on Nov 26, 2016
The Aditya Vision IPO Analysis helps you to understand about the company, offer detail, valuation, capital structure and financial performance. Our SEBI registered IPO Analysts tells you if Aditya Vision IPO worth investing. The Aditya Vision IPO Note sets the IPO expectations in systematic way which tells you if Aditya Vision IPO good to buy (good or bad / yes or no). The IPO Forecast tells you weather to invest in Aditya Vision IPO by providing IPO recommendations i.e. subscribe, avoid and neutral.
DISCLAIMER: No financial information whatsoever published anywhere here should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is purely for educational and information purposes only and under no circumstances should be used for making investment decisions. Readers must consult a qualified financial advisor prior to making any actual investment decisions, based on information published here. With entry barriers, SEBI wants only well informed investors to participate is such offers. With crazy recent listings, SME IPOs have started drawing attention of investors across the board. However, as SME issues have entry barriers and continued low preference from broking community, any reader taking decisions based on any information published here does so entirely at own risk. Above information is based on information available as on date coupled with market perceptions. Author has no plans to invest in this offer.
(SEBI registered Research Analyst-Mumbai).
About Dilip Davda
Dilip Davda is veteran journalist associated with stock market since 1978. He is contributing to print and electronic media on stock markets/insurance/finance since 1985.
Dilip Davda is a leading reviewer of public issues and NCDs in the primary stock market in India. The knowledge he gained over 3 decades while working in the stock market and a strong relationship with popular lead managers makes his reviews unique. His detail fundamental and financial analysis of companies coming up with IPO helps investors in the primary stock market. Dilip Davda has a special interest in analyzing the SME companies and writing reviews about their public issues. His reviews are regularly published online and in new papers.
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