Max Alert Systems Ltd IPO Review (Avoid)

Review By Dilip Davda on Jun 27, 2012

Max Alert System Ltd. : The Company is coming out with a fixed priced IPO for BSE-SME platform listing for a total size of Rs. 8 crore. The company is offering 40,00,000 equity share of Rs. 10 each at a price of Rs. 20 per share. The issue is opening for subscription on 28.06.2012 and closes on 02.07.2012. Minimum application is to be made for 6000 shares and in multiples thereof. The issue is lead managed by Comfort Securities Ltd. who will also work as market maker for this issue. For Lead Manager total of 600000 shares are reserved for subscription and the rest is being offered to public. The company that was engaged in the business of providing solutions for fire fighting, BMS and other allied activities has later on diversified into telecom industry i.e. installation of mobile towers which has yet to take off.

Now it mulls to set up crushing plant for which it is planning to mobilize the funds via this offer. Sharepro Services India Pvt Ltd. is the registrar to the issue. Listing will be done on BSE -SME platform where again the minimum entry level will be of 6000 shares for bid and offer.


Conclusion / Investment Strategy

On performance front, the company has posted net profit of Rs. 1.73 crore and 1.30 crore for the last two fiscals of 2010-11 and 2009-10 on a turnover of Rs. 33.35 crore and 28.68 crore respectively. For nine months ended 31.12.2011 it has earned net profit of Rs. 1.71 crore on a turnover of Rs. 31.31 crore. Company's weighted average EPS for last three fiscal is Rs. 3.03 and for the nine months ended 31.12.2011 is Rs. 4.37 (annualized). NAV as on 31.12.11 is Rs. 75.10 which stands reduced post bonus issue of February 2012 and post issue NAV shall be around Rs. 20.78. The company has issued bonus shares in the ratio of 5 for 2 on 31.03.2011 and 9 for 2 on 08.02.12. Although the pricing looks reasonable, considering the recent fate of SME listings, only risk aver HNI investors can consider parking of funds for long term.

Reviewer recommends Avoid to the issue.

Review By Dilip Davda on Jun 27, 2012

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

Max Alert Systems IPO FAQs

  1. 1. Why Max Alert Systems IPO?

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

  2. 2. How is Max Alert Systems IPO?

    Read the Max Alert Systems IPO recommendations by the leading analyst and leading stock brokers.

  3. 3. Max Alert Systems IPO what should investors do?

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

  4. 4. Is Max Alert Systems IPO good?

    Our recommendation for Max Alert Systems IPO is to avoid.

  5. 5. Is Max Alert Systems IPO worth Investing?

    As per the analysis by our lead analyst Mr. Dilip Davda, we suggest you to avoid the Max Alert Systems IPO.

  6. 6. When will Max Alert Systems IPO allotment status?

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

  7. 7. When will Max Alert Systems IPO list?

    The Max Alert Systems IPO will list on Friday, July 13, 2012, at BSE SME.








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