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Trident Texofab BSE SME IPO review (May apply)

Review By Dilip Davda on Sep 17, 2017

Trident Taxofab Ltd. (TTL) is a multi-product fabric trading Company and its range includes home furnishing, bed sheets, scarf, pareos, suiting and shirting and technical textile fabrics, etc. Company’s product portfolio consists of finished, unfinished fabrics and value added fabrics.

To part finance its working capital and general corpus fund needs, TTL is coming out with a maiden IPO of 1176000 equity share of Rs. 10 each at a fixed price of Rs. 30 per share to mobilize Rs. 3.53 crore. Issue opens for subscription on 21.09.17 and will close on 26.09.17. Minimum application is to be made for 5000 shares and in multiples thereon, thereafter. Post allotment, shares will be listed on BSE SME. Issue is jointly lead managed by Guiness Corporate Advisors Pvt. Ltd. and Indian Overseas Bank (IOB). Karvy Computershare Pvt. Ltd. is the registrar to the issue. Having issued initial equity at par, it raised further equity in the price range of Rs. 35 to Rs. 100 per share (between January 2010 to May 2017) and has also issued bonus shares in the ratio of 7 for 1 in April 2017. Post issue, its current paid up equity capital of Rs. 2.82 crore will stand enhanced to Rs. 4 crore. Issue constitutes 29.43% of fully diluted post issue paid up equity capital of the company.

On performance front, for last four fiscals TTL has reported turnover/net profits of Rs. 60.52 cr. / Rs. 0.22 cr. (FY14), Rs. 62.65 cr. / Rs. 0.18 cr. (FY15), Rs. 66.03 cr./ Rs. 0.06 cr. (FY16) and Rs. 76.19 cr. / Rs. 0.34 cr. Thus while top line has been seeing upward trends, bottom line has witnessed roller coaster ride. For last three fiscals, it has posted an average EPS of Rs.0.70 and average RoNW of 5.93%. Issue is priced at a P/BV of 1.93. If we attribute latest earnings on fully diluted post issue equity then asking price is at a P/E of 35 plus against industry average of 20. Thus issue is priced aggressively.

On merchant banker’s front, from Guiness this is the 18th mandate from its stable in past three years and out of last 10 listings, 3 issues opened at discount, 1 at par and the rest with 3 to 20% premium on offer price on the listing day. From IOB this is the 5th mandate in last two years and out of last 4 listings all opened at a premium ranging from 12 to 20% on the day of listing.

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


Conclusion / Investment Strategy

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

Review By Dilip Davda on Sep 17, 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

Trident Texofab IPO FAQs

  1. 1. Why Trident Texofab IPO?

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

  2. 2. How is Trident Texofab IPO?

    Read the Trident Texofab IPO recommendations by the leading analyst and leading stock brokers.

  3. 3. Trident Texofab IPO what should investors do?

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

  4. 4. Is Trident Texofab IPO good?

    Our recommendation for Trident Texofab IPO is to subscribe for long term.

  5. 5. Is Trident Texofab IPO worth Investing?

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

  6. 6. When will Trident Texofab IPO allotment status?

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

  7. 7. When will Trident Texofab IPO list?

    The Trident Texofab IPO will list on Thursday, October 5, 2017, at BSE SME.