Loyal Equipments BSE SME IPO review (May apply)

Review By Dilip Davda on Jul 1, 2015

Loyal Equipments Ltd (LML) is engaged in manufacturing and supplying of Coded Pressure Vessels & Heat Exchangers (Ferrous & Non Ferrous), Air Cooled Heat Exchangers, Skids for Dynamic and Static Machineries, Base-Plates, Sterilizers, Chimneys and Columns, Tanks & Receivers, Site Fabrication & Erection Activities. These products are widely used in the industries like Petro-chemicals, Compressor Industries, Power Plants, Fertilizers, Refinery, Pharmaceuticals and Dairy Industry. All these products are manufactured on tailor made basis to suit customers’ needs. LML’s client list includes RIL, L & T, Ingersoll Rand, Engineers India etc.

To meet its working capital requirements, the company is coming out with an IPO of 1800000 equity share of Rs. 10 each at a fixed price of Rs. 18 per share. Issue opens for subscription on 03.07.15 and will close on 07.07.15. Minimum application is to be made for 8000 shares and in multiples thereon, thereafter. Issue is lead managed by Hem Securities Ltd. and registrar to the issue is Sharex Dynamic (I) Pvt Ltd. Post allotment, shares will be listed on BSE SME. LML will mobilize Rs. 3.24 crore via this IPO. The company issued all equity at par since incorporation and has also issued bonus shares in the ratio of 49 for 1 (on 20.01.11), 2 for 1 (on 16.11.13) and 2 for 3 (on 28.04.15) that raised its paid up equity to Rs. 5 crore that will now stand enhanced to Rs. 6.8 crore post IPO.

On performance front, for last three fiscals, the company has posted turnover and net profit of Rs. 9.19 crore/Rs. 1.46 crore (FY 2013), Rs. 9.42 crore/Rs. 1.04 crore (FY 2014), Rs. 14.87 crore/Rs. 1.98 crore (FY 2015).


Conclusion / Investment Strategy

If we attribute FY 2015 earnings on current equity then asking price is at a P/E of 4.5 and on fully diluted post equity it is at a P/E of 6.18 that appears reasonable against industry composite P/E of 35.

On merchant banker’s front, this is 15th IPO from its stable and it has mixed trends for its past thirteen listed mandates. Last IPO of Junction Fabric is yet to be listed.

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. As SME issues have entry barriers and low preference from broking community, any reader taking decisions based on any information published here does so entirely at own risk. Author has no plans to invest in this offer.

Review By Dilip Davda on Jul 1, 2015

Review Author

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 before making any actual investment decisions, based on information published here. With entry barriers, SEBI wants only well-informed investors to participate in such offers. With crazy listings in the past, SME IPOs drew the attention of investors across the board. 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 own risk. The above information is based on information available as on date coupled with market perceptions. The Author has no plans to invest in this offer.

(SEBI registered Research Analyst-Mumbai).


About Dilip Davda

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.

Email: dilip_davda@rediffmail.com

Loyal Equipments IPO FAQs

  1. 1. Why Loyal Equipments IPO?

    The initial public offer (IPO) of Loyal Equipments Ltd offers an early investment opportunity in Loyal Equipments Ltd. A stock market investor can buy Loyal Equipments IPO shares by applying in IPO before Loyal Equipments Ltd shares get listed at the stock exchanges. An investor could invest in Loyal Equipments IPO for short term listing gain or a long term.

  2. 2. How is Loyal Equipments IPO?

    Read the Loyal Equipments IPO recommendations by the leading analyst and leading stock brokers.

  3. 3. Loyal Equipments IPO what should investors do?

    Loyal Equipments IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the Loyal Equipments IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts in the above answer.

  4. 4. Is Loyal Equipments IPO good?

    Our recommendation for Loyal Equipments IPO is to subscribe for long term.

  5. 5. Is Loyal Equipments IPO worth Investing?

    As per the analysis by our lead analyst Mr. Dilip Davda, we suggest you to subscribe for long term to the Loyal Equipments IPO.

  6. 6. When will Loyal Equipments IPO allotment status?

    The Loyal Equipments IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit Loyal Equipments IPO allotment status to check.

  7. 7. When will Loyal Equipments IPO list?

    The Loyal Equipments IPO will list on Thursday, July 16, 2015, at BSE SME.








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