Valiant Org BSE SME IPO review (Apply)

Review By Dilip Davda on Sep 28, 2016

Valiant Organics Ltd (VOL) is a chemical manufacturing company with focus on manufacturing and marketing of different types of chlorophenol which is a chemical which has several applications mainly into agro-chemical industry, pharmaceutical industry, dyes industry, manufacturing of cosmetics and veterinary drugs. The company operates a single location manufacturing facility at Sarigam Industrial Estate having an installed capacity of 4,800 mtpa. Over the years it has built goodwill amongst customers and export markets and it believes the demand for its products are more than supply capacity, hence, it has started the process of applying with the government agencies to augment production capacities upto 21,600 metric tonnes over the next few years in a phased manner.

For listing gains the company is coming out with a maiden IPO of 964800 equity shares of Rs. 10 each at a fixed price of Rs. 220.00 per share as offer for sale to mobilize Rs.21.23 crore. Issue opens for subscription on 29.09.16 and will close on 04.10.16. Minimum application is to be made for 600 shares and in multiples thereon, thereafter. Issue is solely managed by Aryaman Financial Services Ltd and Bigshare Services Pvt Ltd is the registrar to the issue. Post allotment, shares will be listed on BSE SME. It has issued shares at par for the MoA and soon thereafter at a price of Rs. 250 per share. It also bought back its shares from December 2007 to April 2012 in the price range of Rs. 250 to Rs. 440 per share. It has also issued bonus shares in the ratio of 1 for 5 in November 2007, 1 for 10 in November 2008, 2 for 5 in January 2010, 1 for 10 in January 2011 and 9 for 1 in August 2015. Being offer for sale, its equity stands at Rs. 3.64 cr. post IPO.

Company’s revenue from operations has increased at a CAGR of 12.37% from Rs. 33.19 cr. in F.Y. 2012 to Rs. 53.48 cr. in F.Y. 2016. Its earnings before interest, depreciation and tax has increased at a CAGR of 24.33% from Rs. 7.18 cr. in F.Y. 2012 to Rs. 17.16 cr. in F.Y. 2016, and profit after tax has increased at a CAGR of 27.36% from Rs. 3.92 cr. in F.Y. 2012 to Rs. 10.31 cr. in F.Y. 2016. It has delivered average Return on Net worth of 32.17% over the last five years. Its top line has seen set back in FY16. Based on last earnings, the issue is being made at a P/E of 7 plus against industry composite of 29 plus and thus is reasonably priced.

On merchant banker’s front, this is the 11th mandate in last three years and past mandates have shown average performance on listing day.

Conclusion: Long term investors may consider investment in this justifiably priced IPO.


Conclusion / Investment Strategy

Long term investors may consider investment in this justifiably priced IPO.

Reviewer recommends Subscribing to the issue.

Review By Dilip Davda on Sep 28, 2016

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

Valiant Organics IPO FAQs

  1. 1. Why Valiant Organics IPO?

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

  2. 2. How is Valiant Organics IPO?

    Read the Valiant Organics IPO recommendations by the leading analyst and leading stock brokers.

  3. 3. Valiant Organics IPO what should investors do?

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

  4. 4. Is Valiant Organics IPO good?

    Our recommendation for Valiant Organics IPO is to subscribe.

  5. 5. Is Valiant Organics IPO worth Investing?

    As per the analysis by our lead analyst Mr. Dilip Davda, we suggest you to subscribe to the Valiant Organics IPO.

  6. 6. When will Valiant Organics IPO allotment status?

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

  7. 7. When will Valiant Organics IPO list?

    The Valiant Organics IPO will list on Friday, October 14, 2016, at BSE SME.








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