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Milton Ind. NSE SME IPO review (May apply)

Review By Dilip Davda on Sep 27, 2017

Milton Industries Ltd. (MIL) is engaged in manufacturing of Laminates, Artificial Leather cloth and Glass Fibre Reinforced Epoxy (GFRE) Sheets in the state of Gujarat. The company is the manufacturer and exporter of premium quality high-pressure laminates, industrial Laminates, laminated board, flooring laminates, artificial Leather cloth, GFRE Sheets and other allied products. Its superior quality laminates can be used on walls, doors, windows, cupboards, tabletops, hotels, cash counters, home kitchen, etc. Initially Company was engaged in manufacturing of laminates and further diversified in manufacturing and exports of Artificial Leather cloth and GFRE Sheets.

To part finance its working capital and general corpus fund needs, MIL is coming out with a maiden IPO of 4200000 equity share of Rs. 10 each at a fixed price of Rs. 34 per share to mobilize Rs. 14.28 crore. Issue opens for subscription on 29.09.17 and will close on 06.10.17. Minimum application is to be made for 4000 shares and in multiples thereon, thereafter. Issue is solely lead managed by Swastika Investmart Ltd. and Skyline Financial Services Pvt. Ltd. is the registrar to the issue. Post allotment, shares will be listed on NSE SME Emerge. . Issue constitutes 27.18% of the post issue paid up capital of the company. It has issued equity at par and has also issued bonus shares in the ratio of 1 for 10 in October 1994, 1 for 1 in January 1995, 1 for 2 in August 1995, 1 for 5 in October 2000, 1 for 3 in December 2002 and 5 for 4 in July 2017. Post issue, its current paid up equity capital of Rs. 11.25 cr. will stand enhanced to Rs. 15.45 cr.

On performance front, MIL has reported turnover/net profits of Rs. 45.46 cr. / Rs. 0.74 cr. (FY14), Rs. 42.28 cr. / Rs. 0.63 cr. (FY15), Rs. 42.03 cr. / Rs. 0.22 cr. (FY16) and Rs. 43.63 cr. / Rs. 1.15 cr. (FY17). Thus while its top line has remained almost constant, its bottom line has seen roller-coaster ride. It has posted an average EPS of Rs. 0.67 and average RoNW of 5.81% for last three fiscals on an equity base of Rs. 5 crore. Issue is priced at a P/BV of 2.86. If we attribute latest earnings on fully diluted equity post issue, then asking price is at a P/E of 45 plus against industry average of 38 making it aggressively priced offer. Cost of acquisition of shares by promoters ranges from Rs. 4 to Rs. 12.

On merchant banker’s front, this is the 7th mandate from its stable and last five listings have given between 4 to 25% gains on the day of listing.

Conclusion: Considering aggressive pricing, risk savy cash surplus investors may consider investment for long term.


Conclusion / Investment Strategy

Considering aggressive pricing, risk savy cash surplus investors may consider investment for long term.

Review By Dilip Davda on Sep 27, 2017

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

Milton Industries IPO FAQs

  1. 1. Why Milton Industries IPO?

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

  2. 2. How is Milton Industries IPO?

    Read the Milton Industries IPO recommendations by the leading analyst and leading stock brokers.

  3. 3. Milton Industries IPO what should investors do?

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

  4. 4. Is Milton Industries IPO good?

    Our recommendation for Milton Industries IPO is to subscribe for long term.

  5. 5. Is Milton Industries IPO worth Investing?

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

  6. 6. When will Milton Industries IPO allotment status?

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

  7. 7. When will Milton Industries IPO list?

    The Milton Industries IPO will list on Monday, October 16, 2017, at NSE SME.