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Review By Dilip Davda on September 28, 2017
Omfurn India Ltd. (OIL) is engaged in providing premium quality commercial furniture to its customers. Company produces innovative and operational commercial furniture solutions for all work and commercial environments. It manufactures and supply modular furniture which broadly includes hotel furniture, office furniture, school furniture, wooden shutter doors & door frames in terms of customized, system based or Turnkey projects throughout India. It also supplies tailored outfits as per the choice of customers.
To part finance its expansion project and general corpus fund needs, OIL is coming out with a maiden IPO of 1812000 equity shares of Rs. 10 each at a fixed price of Rs. 23 per share to mobilize Rs.4.17 crore. Issue opens for subscription on 29.09.17 and will close on 05.10.17. Minimum application is to be made for 6000 shares and in multiples thereon, thereafter. Post allotment, shares will be listed on NSE SME Emerge. Issue constitutes 26.60% of post issue paid up equity capital of the company. Issue is solely lead managed by Sarthi Capital Advisors Pvt. Ltd. and Bigshare Services Pvt. Ltd. is the registrar to the issue. From incorporation till July 1998 it raised equity at par and has issued bonus shares in the ratio of 9 for 1 in March 2007 and again 9 for 1 in February 2017. Post issue, its current paid up equity capital of Rs. 5.00 crore will stand enhanced to Rs. 6.81 crore. Cost of acquisition of shares by promoters is Rs. –(0.13) per share. (i.e. almost zero cost)
On performance front, OIL has posted turnover/net profits of Rs. 19.76 cr. / Rs. 0.76 cr. (FY14), Rs. 38.66 cr. / Rs. 1.31 cr. (FY15), Rs.43.88 cr. / Rs. 1.87 cr. (FY16) and Rs. 28.19 cr. / Rs. 1.61 cr. (FY17). It has suffered a setback for FY 17 in top line. OIL has posted an average EPS of Rs. 3.30 and average RoNW of 11.42% for last three fiscals. Issue is priced at a P/BV of 0.74 (i.e. below 1). If we attribute latest earnings on fully diluted post issue equity then asking price is at a P/E of around 9.7. As per prospectus, it has no listed peers to compare with.
On merchant banker’s front, this is the 33rd mandate from its stable and out of last 10 listings 2 got listed at discount, 1 at par, and the balance 7 with a premium ranging from 3 to 131 per cent on the day of listing.
Conclusion: Although issue pricing is lucrative, considering decline in top line its immediate future looks gloomy, risk savvy investors may consider investment for long term.
Review By Dilip Davda on September 28, 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 Omfurn India Limited offers an early investment opportunity in Omfurn India Limited. A stock market investor can buy Omfurn India IPO shares by applying in IPO before Omfurn India Limited shares get listed at the stock exchanges. An investor could invest in Omfurn India IPO for short term listing gain or a long term.
Read the Omfurn India IPO recommendations by the leading analyst and leading stock brokers.
Omfurn India IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the Omfurn India IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts in the above answer.
Our recommendation for Omfurn India IPO is to subscribe for long term.
As per the analysis by our lead analyst Mr. Dilip Davda, we suggest you to subscribe for long term to the Omfurn India IPO.
The Omfurn India IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit Omfurn India IPO allotment status to check.
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