Organic Recycling Systems Limited IPO Message Board (Page 2)

Sarang Bhand (promoter): 20.35% stake
Pvt investors: 47.17%
IPO investors: 32.47%

Risk of Pvt investors (modi,mehta,shah,patel) overthrowing management remains even after fresh issue. Each lot is 0.78% approx so buying 5 lots out of 4167 lots from secondary market will give them >51% majority again.

Some calc error sir... each lot is not .78% ... chk again ...

Yes @Earthking sir. There was an error due to % in denominator.
Sorry for this mistake.
I rectify my previous statement:
Each lot is 0.0078% approx so buying 500 lots out of 4167 lots from secondary market will give them >51% majority again.

Last issue managed by LM was in Oct-18.
Company provides engineering and waste management solutions. Peers would be Antony Waste, Urbran Enviro etc.
Pre-IPO promoter holding was 30% which will go down to 20% post IPO
Company has patented technology and engineering solutions to turn Municipal Solid Waste (MSW) into electricity and bio-fertilizer. However majority of the clients will be government bodies (municipal corporations) and hence delay in project execution, cost over runs and delay in payments will be normal.
Poor cash flow for last 3 years. Positive cash flow in 21-22 is due to increase in current liabilities and not because of any operational efficiencies
High Debt to EBITDA of around 5.7.
Balance sheet has goodwill on consolidation, implying payment in excess of fair value for acquisitions.
Intangible assets under development have jumped from Rs 6 cr to Rs 10 cr. Whether these will give any tangible results to shareholders is to be seen. Out of these Rs 10 cr intangible assets, Rs 6 cr is WIP over 1 year, Rs 3 cr is WIP over 2 years.
Receivables of Rs 31 cr on revenue of Rs 24 cr, implying a very long collection period. It seems customers are using credit from this company to finance their business. Out of receivables of Rs 31 cr, Rs 14 cr is outstanding for over 1 year.
YoY revenue has increased by 50% whereas direct expenses have gone down by 22% and other expenses have gone down by 12%. Within direct expense, power & fuel cost, security expenses and P&M hiring charges have remained flat or reduced. Sustainability of such reduction is to be seen. Within other expense, in 21-22 there was a bad debt write off for Rs 1.5 cr and provision for bad debt for Rs 74 lacs and goodwill impairment of Rs 11 lacs. These line items are not recurring in 22-23. If the company has done a clean up then it is good else such expenses could come up again.
Also, if the main customers are government bodies, why there should be write off for debts?
Shareholding shows investors like Jaya Gogri (Arti Organics), Gauri Khan Trust (SRK), Vipul Modi (Samco group)
It seems statutory auditor of the company Jayesh Sanghrajka also has shareholding in the company. Wonder if this would be a conflict of interest.
IPO proceeds would be used to repay loans of Rs 37.5 cr and for general corporate purposes
For an IPO of Rs 50 cr, there is no QIB portion. Wonder whether it is because LM found no takers for QIB / anchor portion.
Financial indebtedness statement, page 207 of prospectus, is an interesting read. Secured LT bank loans carry interest rate of 8.75% to 10-11%. Short term bank loans are at 13% approx. Some of the unsecured NBFC loans are at 6%, 12% and 18%. Around Rs 27.5 cr unsecured loans are interest free and the lenders are Sarang Bhand, Sunil Equitrade, La Fin Financial Services, Indo Euro Indchem.
As on 14-sep-23, company has 36 employees on its rolls and another 81 in its subsidiary. As per EPFO, company deposited PF of 35 employees for Aug-23 and 45 employees for Aug-22 (subsidiary not included).

Sir, I have tried to figure out the acquition cost of Gauri Khan trust/ Jaya gogri/ vipul Modi but have not been able to do. Please guide as to at what price they have acquired the holding.

​@EKANT PATNI 

If these entities have been allotted fresh shares / convertible securities by the company, then you may able to trace it from the capital structure.
If the acquisition is between 2 parties, an existing shareholder and a incoming shareholder, company is not required to disclose it in prospectus.
Fellow boarders can provide more insight in this.

Skipping

LM has no recent track records. Old records show more volatility and not consistent. Myself avoiding this ipo

GMP 20/-

Big size won't apply aggressively. try limited application.

Can't trust LM.

Please reply bro S2 deal available

@ArjunRajkot Here you are wrong it will not list in discount.reminds khajanchi jewellers.

Any S2 Rate available please post if any one get or heard @Arjun Rajkot

ANAEROBIC

But seeing the valuation I am also choking on the without air part of anaerobic breakdown.

Promotor Holding will be only 20% after issue. I personally avoid these type of IPO in SME.

very High price beware Let Few SME Ipo fails Then only promoters will be less greedy and will left for investors

क्या हैं ये...,
ये क्या है....
पचास करोड....
कितने तेजस्वी लोग है हमारे यहाँ.,
कहासे लाते है इतना साहस....
यकीन नहीं होता

​@NeoLongus 
Post issue promoter holding 20%. ⚠️⚠️⚠️⚠️
50 cr Without qib 🛑🛑🛑
Inconsistent financials 👎👎👎

Even after 50 cr IPO, company will not be able to repay borrowings completely (around 70 cr). Borrowings are more than revenue.

🌍🌳💓 Environment 💓🌳🌎

Lgta hai ipo sucessful nahi hoga , ❌ hi hoga

​@JAI JAI GARVI GUJARAT , @Cyclodium 
Ho jaayega successful, fix application buying ho rahi hai (with condition of applying on day-1 before 11 am) .
Early subscription dekh ke log tut padenge !

abhi toh IPOs ka mausam chal raha hai kab chala jaye bhanak bhi nhi padegi

Seems waste of money. I don't think we need to go for thorough study of this one after seeing very low promoter holding and loss in 2 years out of 3 years.

Jab promoters ko hi apni company nahi rakhni to hum bechare retailers ko bhi bachna chahiye 😇🙏

Dil se ek hi awaaz ayi "Kachra company hai"

Promoter holding just 20%.......means ...its a Laawaris company

No THANQ

Boycott this loss making company asking 190 premium

Another recycling company IPO. Looks like investors and retailers are the real rag pickers, selecting and nit picking from these waste and recycle company IPOs. Companies take up huge borrowings, and when the business does not run, let's bring an IPO to reduce the borrowings. Retail investors are deemed foolish for them