Oasis Tradelink Ltd IPO Review (Avoid)

Review By Dilip Davda on Jun 19, 2014

 

Oasis Tradelink Ltd (OTL) is in the business of trading and marketing of branded and packaged edible oils and entered into the manufacturing and production by leasing a packaging/production unit in Kadi in north Gujarat. Over the last couple of years, the company has achieved growth in sales, owing to acquiring marketing and sales rights of MARUTI Brand oil in Gujarat. The company sources its products from multinational suppliers, and packages them under various popular brands. Over the years, the company has built up a credible sales-force to market its products in Gujarat, Maharashtra, Madhya Pradesh and Rajasthan. OTL manufactures and markets Refined Cottonseed Oil, Pure Groundnut Oil, Refined Groundnut Oil, Refined Sunflower Oil, Refined Corn Oil, Pure Mustard Oil and Refined Soybean Oil. 

 

To meet its working capital requirement and brand building and other expenses, the company is coming out with an IPO of 2000000 equity share of Rs. 10 each at a fixed price of Rs. 30 per share to mobilize Rs. 6 crore. Issue opens for subscription on 23.06.14 and will close on 30.06.14. Minimum application is to be made for 4000 shares and in multiple thereof, thereafter. Post allotment, shares will be listed on BSE SME platform. Issue is lead managed by Guiness Corporate Advisors Pvt Ltd and Sharepro Services (India) Pvt Ltd is the registrar to the issue. 

 

For last two fiscals it has posted turnover and net profit of Rs. 43.39 crore and Rs. 0.16 crore (2011-12) and Rs. 73.58 crore and Rs. 0.13 crore (2012-13). For first nine months ended 31.12.13 it has reported turnover of Rs. 91.54 crore with a net profit of Rs. 0.14 crore. Its equity of Rs. 1 crore has grown to Rs. 5.30 crore during this period with fresh issue mostly at par and bonus in the ratio of 7 for 20 in August 2013. Post issue its equity will be Rs. 7.30 crore. If we attribute current earnings on expanded equity then the issue price is at a P/E of 26 plus making it a costly bet. 

On merchant banker’s front, this is 13th SME mandate with very odd performances for past offers.

Issue opens for subscription on 23.06.14 and will close on 30.06.14.


Conclusion / Investment Strategy

 

Not Worth. It has entry barrier as well.

Reviewer recommends Avoid to the issue.

Review By Dilip Davda on Jun 19, 2014

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

Oasis Tradelink IPO FAQs

  1. 1. Why Oasis Tradelink IPO?

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

  2. 2. How is Oasis Tradelink IPO?

    Read the Oasis Tradelink IPO recommendations by the leading analyst and leading stock brokers.

  3. 3. Oasis Tradelink IPO what should investors do?

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

  4. 4. Is Oasis Tradelink IPO good?

    Our recommendation for Oasis Tradelink IPO is to avoid.

  5. 5. Is Oasis Tradelink IPO worth Investing?

    As per the analysis by our lead analyst Mr. Dilip Davda, we suggest you to avoid the Oasis Tradelink IPO.

  6. 6. When will Oasis Tradelink IPO allotment status?

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

  7. 7. When will Oasis Tradelink IPO list?

    The Oasis Tradelink IPO will list on Monday, July 14, 2014, at BSE SME.








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