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Review By Dilip Davda on November 14, 2017
Sharika Enterprises Ltd. (SEL) is engaged in Engineering Procurement Construction (EPC) contracts, specialized assembling, trading activities, Erection Services, representation services to majorly power Generation, Transmission and Distribution sector. Company has grown consistently over the years and widened its portfolio which covers installing power transmission EHV cables, designing & installing EMS (Energy Management System) and allied distribution automation Equipments such as Autoreclosers, fault passage indicators (FPI) etc., designing and installing of Solar Power Generation plants.
Company has introduced LS Cables in India for 220 kV XLPE cables and 400 kV XLPE cables in the year 2008. It is also associated with Andritz Hydro since 2004 in developing their Hydro Power Projects with National Hydroelectric Power Corporation (NHPC), National Thermal Power Corporation (NTPC) and State Electricity Boards, especially in north and north-east India with projects like NHPC/4×41 MW Teesta Low Dam-III, MeSEB/2×42 MW Myntdu Leshka, HPSEB/4×15 MW RMU & LE Bassi HEP, HPSEB/2×2.25 MW Bhaba Augmentation HEP, HPPCL/3×65 MW Kashang HEP etc.
To meet its working capital and general corpus funds needs, SEL is coming out with a maiden IPO of 3225000 equity shares of Rs. 10 each at a fixed price of Rs.43 per share to mobilize Rs. 13.87 crore. Issue opens for subscription on 15.11.17 and will close on 17.11.17. Minimum application is to be made for 3000 shares and in multiples thereon, thereafter. Post allotment, shares will be listed on BSE SME. Issue constitutes 29.79% of post issue paid up capital of the company. Issue is solely lead managed by Swastika Investmart Ltd. and Skyline Financial Services Pvt. Ltd. is the registrar to the issue. Cost of acquisition of shares by promoters is Rs. 0.13 per share. It has issued entire equity at par so far and has also issued bonus shares in the ratio of 75 for 1 in August 2017. Post issue its current paid up equity capital of Rs. 7.60 crore will stand enhanced to Rs. 10.83 crore.
On performance front, SEL has (on a consolidated basis) posted turnover/net profits of Rs. 10.81 cr. / Rs. – (0.27) cr. (FY14), Rs. 17.96 cr. / Rs. – (0.48) cr. (FY15), Rs. 18.89 cr. / Rs. 0.98 cr. (FY16), Rs. 23.53 cr. / Rs. 2.02 cr. (FY17). For first two months of current fiscal it has reported net profit of Rs. 0.49 cr. on a turnover of Rs. 2.72 cr. For last three fiscals, it has posted average EPS of Rs.1.65 and average RoNW of 13.07% on an equity capital of Rs. 0.10 crore. Asking price is at a P/BV of 1.91 on the basis of post issue NAV. If we annualize latest earnings and attribute it on fully diluted equity post issue, then issue is priced at a P/E of around 16 against its peers ( as per offer documents they are L&T, Engineers India) trading on an industry average of 29 plus. Thus issue appears to have been priced reasonably.
On merchant banker’s front, this is the 8th mandate from its stable so far and last 7 listings has opened at a premium of 4 to 20% on the offer price on debut day.
Conclusion: Investment may be considered for medium to long term. (Subscribe).
Review By Dilip Davda on November 14, 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 Sharika Enterprises Limited offers an early investment opportunity in Sharika Enterprises Limited. A stock market investor can buy Sharika Enterprises IPO shares by applying in IPO before Sharika Enterprises Limited shares get listed at the stock exchanges. An investor could invest in Sharika Enterprises IPO for short term listing gain or a long term.
Read the Sharika Enterprises IPO recommendations by the leading analyst and leading stock brokers.
Sharika Enterprises IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the Sharika Enterprises IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts in the above answer.
Our recommendation for Sharika Enterprises IPO is to subscribe.
As per the analysis by our lead analyst Mr. Dilip Davda, we suggest you to subscribe to the Sharika Enterprises IPO.
The Sharika Enterprises IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit Sharika Enterprises IPO allotment status to check.
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Elettromeccanica India Pvt Ltd is a joint-venture company of Sharika with Elettromeccanica, Italy, a leading manufacturer of transformers based in Milan.
2) Sharika Lightec Pvt Ltd, a joint-venture of Sharika Enterprises with Dongbu Lightec Co. Ltd, South Korea, brings SmartOn, a range of eco-friendly, smart LED lights to India.
Nothing mentioned about the above valuable information by our Dilip Davda - Research Analyst..........What is the use of highlights of Report....