Vadivarhe Speciality Chemicals Ltd IPO Message Board (Page 5)

Last 5 issues lead by Hem gave positive listing gains.
4 issues (Krishna Phoschem, Global Education, RMC Switchgears, Dev Information Technology Ltd) loacked in upper circuit on listing day and as-of today gave returns from 17% (Krishna Phoschem) to 87% (Global Education).
1 issue (Laxmi Cotspin Ltd.,) reached listing-day-high of 7% and now trading at 7% discount.

Pros:
D/E ratio is getting reduced every year (and it is currently 0.61 - which is pretty safe).
ReturnOnEquity is ~20% (if this continues, within 3-4 years it could give more than 100% return).
Cash flow is positive and moreover in the same range.
9 month EBITA of this fiscal has already overshadowed last fiscal EBITA.
Cons:
Raw material cost is getting little higher every year and the cost-curve here is becoming exponential compared to the sales (by plotting sales-turnover in x-axis and raw-material-cost in y-axis). This is not-at-all big concern as long as it doesn''t eat more than one-third of the sales.

For now, on paper Vadivarhe looks good to subscribe. There is no reason to stay away from it.

P & L Account (Rs.in Crs.):
Year      Mar 16      Mar 15
Sales Turnover      26.28      19.03
Other Income      0.14      0.11
Stock Adjustments      0.56      -0.18
Total Income      26.98      18.96
Raw Materials      8.13      1.86
Excise Duty      0.00      0.00
Power & Fuel Cost      0.00      0.00
Other Manufacturing Expenses      0.00      0.00
Employee Cost      3.22      2.82
Selling and Administration Expenses      0.00      0.00
Miscellaneous Expenses      8.11      6.65
Less: Preoperative Expenditure Capitalised      0.00      0.00
Profit before Interest, Depreciation & Tax      7.53      7.62
Interest & Financial Charges      1.21      0.89
Profit before Depreciation & Tax      6.32      6.73
Depreciation      1.03      1.09
Profit Before Tax      5.29      5.65
Tax      1.91      1.67
Profit After Tax      3.38      3.98
Adjustment below Net Profit      0.00      -0.02
P & L Balance brought forward      -2.03      -5.98
Appropriations      0.00      0.00
P & L Bal. carried down      1.35      -2.03
Equity Dividend      0.00      0.00
Preference Dividend      0.00      0.00
Corporate Dividend Tax      0.00      0.00
Equity Dividend (%)      0.00      0.00
Earning Per Share (Rs.)      6.98      8.22
Book Value      37.00      30.02
Extraordinary Items      0.00      0.00

Key operating ratios
Year end      Mar 16      Mar 15
EPS(Rs)      6.98      8.22
Book value(Rs)      37.00      30.02
CEPS(Rs)      9.11      10.48
NPM(%)      12.86      20.91
OPM(%)      28.65      40.04
ROCE(%)      23.55      23.22
ROE(%)      19.62      24.05
Debt/equity      0.61      0.77
Interest cover      5.37      7.35

Cash flow analysis (Rs.in Crs.)
Year end      Mar 16      Mar 15
NOPAT      4.15      4.61
Operating cash flow      3.63      5.27
Free cash flow      4.32      5.46

Key financials (Rs.in Crs.):
Year end      Mar 16      Mar 15
Net sales      26.28      19.03
Operating profit      7.53      7.62
Net profit      3.38      3.98
Equity cap pd      4.84      4.84

Balance Sheet (Rs.in Crs.):
Year       Mar 16      Mar 15
Share Capital      4.84       4.84
Reserves & Surplus      13.06      9.68
Total Shareholders Funds      17.90      14.52
Secured Loans      6.60      4.31
Unsecured Loans      2.53      7.29
Total Debt      9.13      11.60
Total Liabilities      27.03      26.12
Gross Block      14.66      15.02
Less: Accum. Depreciation      0.00      0.00
Net Block      14.66      15.02
Capital Work in Progress      0.00      0.00
Investments      0.05      0.05
Inventories      2.42      1.24
Sundry Debtors      8.46      3.70
Cash and Bank Balance      0.48      1.37
Loans and Advances      7.97      8.06
Current Liabilities      5.29      2.25
Provisions      1.73      1.05
Net Current Assets      12.31      11.07
Miscellaneous Expenses not w/o      0.00      0.00
Total Assets      27.02      26.14
Contingent Liabilities      0.00      0.00

Koi grey market activity isme chal nahi rahi hai, to isme achha listing gain HO sakta hai???

Subject to allotment activity chal rahi h.

1 or Faltu company.
Aao sab public ka paisa lootane me lage hai...

Absolutely right !

It looks like a good issue (compared to all-other upcoming SME IPOs in May) and it has shown consistent growth.
Whenever PE is single-digit, it''s a must-buy (5 out of 7 SME IPOs have given positive returns from 11% to 183% this year; 2/7 issues Nitiraj and LaxmiCot gave negative returns -15% and -8% respectively).
If the issue is subscribed 9+ times, it will set the tone for 20% to 50% gain on first week.
I''m yet to get the detailed financial numbers for past 5 years.
I will share those numbers and my view once I get it.

Many SME IPO now a days subscribe more than 10 times, but very poor listing gain and even some open with discount , recent best example is Meera Industries and Bohra Industries ltd and in later even FII has also participated still currently running below issue price, so be cautious

Subscription figure of day one?
Any one have information.

0.80 subscrib

Looks good issue. Only thing which is bothering me why promoters is selling their own share to withdraw their money invested in the venture limiting their stake. I noticed OFS from promoters in many companies managed by Hem. In my view it is not healthy

U can do full investment in this company.
×3 in 1 year.
Don''t miss it.

Out of the total proceeds around 3 cr will come in the company, rest will go to the promoters, further it has pledged it''s factory & building against loan to axis bank.

financial is looking good

1. profit consistently growing
2. export of the company is looking good
3. price is reasonable

APPLY................

Mainly I will be interested to view the cash-flow analysis - which gives an idea about how confident is the management and promoters about the future aspects of the company.

Prabhakaran

Your view on vadivarhe sp chem

Is it woth applying