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Review By Dilip Davda on April 22, 2017
CKP Products Ltd (CPL) has obtained FSSAI registration for the purpose of operating as a ‘Food Business Operator – Distributor’ and is engaged in trading of edible oil, rice and pulses, Potato chips, Fryums and other Namkeens manufacturing etc.
To part finance its working capital requirements, incorporation land capitalization of overseas subsidiary and general corpus fund needs, CPL is coming out with a maiden IPO of 1248000 equity share of Rs. 10 each at a fixed price of Rs. 50 per share to mobilize Rs. 6.24 crore. Issue opens for subscription on 26.04.17 and will close on 28.04.17. Minimum application is to be made for 3000 shares and in multiples thereof, thereafter. Post allotment, shares will be listed on NSE SME Emerge. Aryaman Financial Services Ltd is the sole lead manager and Cameo Corporate Services Ltd is the registrar to the issue. Since incorporation till April 2016 it issued entire equity at par and then issued further equity at a price of Rs. 50 per share in September 2016. It has also issued bonus shares in the ratio of 3 for 4 in June 2016. Post issue its current paid up equity capital of Rs. 2.77 crore will stand enhanced to Rs. 4.02 crore.
It has started major activities from last fiscal only. As such on consolidated basis it has reported turnover of Rs. 72.63 with a net profit of Rs. 1.08 crore. For first nine months ended on 31.12.16 of the current fiscal, it has earned net profit of Rs. 1.29 crore on a turnover of Rs. 112.56 crore. If we annualize the latest earnings and attribute it on the fully diluted equity post issue, then asking price is at a P/E of around 11 plus and at a P/BV of 2.3 plus. Thus issue appears to have been justifiably priced. As per prospectus it considered Oasis Trade as its peer that is currently trading at a P/E of 65 plus.
On merchant banker’s front, this is the 18th mandate from its stable and last 10 listings have shown mixed trends.
Conclusion: Considering performance and the pricing aspect, investors may consider investment for medium to long term.
Review By Dilip Davda on April 22, 2017
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. My reviews do not cover GMP market and operators game plans. Readers must consult a qualified financial advisor before making any actual investment decisions, based the on information published here. With entry barriers, SEBI wants only well-informed investors to participate in such offers. With crazy listings in the recent past, SME IPOs drew the attention of investors across the board and lead to seer madness. However, as SME issues have entry barriers and continued low preference from the broking community, any reader taking decisions based on any information published here does so entirely at their own risk. The above information is based on information available as of date coupled with market perceptions. The Author has no plans to invest in this offer.
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 news papers.
(Dilip Davda -SEBI registered Research Analyst-Mumbai,
Registration no. INH000003127 (Perpetual)
Email id: dilip_davda@rediffmail.com ).
The initial public offer (IPO) of CKP Products Ltd offers an early investment opportunity in CKP Products Ltd. A stock market investor can buy CKP Products IPO shares by applying in IPO before CKP Products Ltd shares get listed at the stock exchanges. An investor could invest in CKP Products IPO for short term listing gain or a long term.
Read the CKP Products IPO recommendations by the leading analyst and leading stock brokers.
CKP Products IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the CKP Products IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts in the above answer.
Our recommendation for CKP Products IPO is to subscribe.
As per the analysis by our lead analyst Mr. Dilip Davda, we suggest you to subscribe to the CKP Products IPO.
The CKP Products IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit CKP Products IPO allotment status to check.
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