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Anuroop Packaging BSE SME RI review (May apply)

Anuroop Packaging Limited Logo

•    APL is engaged in the corrugated packaging solutions segment. 
•    The company has posted profits for the reported periods.
•    Its IPO was also at the same price in November 2019.
•    Post this RI, chances of migration to the mainboard will widen. 
•    Risk seekers/cash surplus investors may consider investment for the long term.

ABOUT COMPANY:
Anuroop Packaging Ltd. (APL) is a corrugated box manufacturer based out of Wada, Thane. It provides quality fixed packaging products such as corrugated boxes, sheets, boards to clients from various industries such as pharmaceutical, stationery, metals, water treatment etc. APL's products can be classified into the following categories: a) Corrugated Boxes and b) Corrugated Sheets/Boards. 

The company caters to a wide variety of industries for corrugated packaging solutions; however, it has a strong grip in catering to clients from the stationery industry where it works with industry leaders such as Kokuyo Camlin, A.W. Faber-Castell (India). Other prominent clients are Himalaya Organics, Ion exchange India, Mattel Toys India, FDC, Pepe Jeans London etc. Manufacturing of corrugated boxes is main line of business but apart from the manufacturing of the corrugated box the company is also involved in the trading of Gum (Turpentine and Dipentene). The trading of Gum was started in the year 2017-2018 but it got the boast in the year 2018-2019.

ISSUE DETAILS:
The company came with its maiden IPO of Rs. 2.64 cr. in November 2019 and offered shares at the same price of Rs. 13 per share. IPO was lead managed solely by Gretex Corporate Services Pvt. Ltd. and spent Rs. 0.61 cr. to mobilize IPO funding. Now it is coming out with a rights issue (RI) of 3064400 equity shares of Rs. 10 each at a fixed price of Rs. 13 per share to mobilize Rs. 3.98 cr. It is offering 2 shares for every 5 shares held on the record date of November 05, 2021. The RI opens for subscription on November 22, 2021, and will close on December 06, 2021. Post allotment, shares will be listed on BSE SME. This issue is managed by the company itself and has no Lead Manager for the same. KFin Technologies Pvt. Ltd. is the registrar to the issue. APL is spending Rs. 0.50 cr. for this RI process. From the residual portion, it will spend Rs. 2.68 cr. for working capital and Rs. 0.80 cr. for general corporate purposes. 

Post RI, APL's current paid-up equity capital of Rs. 7.66 cr. will stand enhanced to Rs. 10.73 cr. Based on the RI pricing, the company is looking for a market cap of Rs.13.94 cr. 

FINANCIAL PERFORMANCE:
On the financial performance front, the company has (on a consolidated basis) posted turnover/net profits of Rs.21.40 cr. / Rs. 2.45 cr. (FTY20) and Rs. 15.02 cr. / Rs. 1.49 cr. (FY21).  Its NAV as of March 31, 2021, stood at Rs. 17.81. Perhaps being an SME company, it has not given any info for its Q1 FY22 financial performance.

As of September 30, 2021, promoters were holding 67.63% of the total paid-up equity capital of the company

SCRIP PERFORMANCE: Based on BSE Website data (Scrip code: 542865)
The scrip last closed on cum-rights basis at Rs. 15.00 on NOVEMBER 2021, and opened at Rs. 15.00 on an ex-rights basis on November 02, 2021. Since then it has posted a high/low of Rs. 15.00 / Rs. 13.01. Perhaps the market maker is doing a good job of maintaining the price around or above the RI pricing. The scrip last closed at Rs. 13.01 on November 18, 2021, and based on this closing price, its market cap comes to Rs. 13.95 cr. The scrip has marked the last 52 weeks high/low of Rs. 18.28 / Rs. 6.83. 


Conclusion / Investment Strategy

The company has been listed on BSE SME since November 2019. It came with maiden IPO at the same price of Rs. 13 per share and not too it is offering RI at the same price. The only sigh of relief is it has not marked any losses for the reported periods so far. Promoter’s holding too at significant level giving some confidence. Cash surplus/risk seeker investors may consider this rights issue with a long term perspective. Chances of migration to the mainboard in the near term will increase with this RI.

Reviewer recommends Subscribing to the issue for Long Term.

Review By Dilip Davda on Nov 18, 2021

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

More Anuroop Packaging Limited RI Views / Analysis / Recommendations ...

The Anuroop Packaging Rights Issue Analysis helps you to understand about the company, offer detail, valuation, capital structure and financial performance. Our SEBI registered Rights Issue Analysts tells you if Anuroop Packaging Rights Issue worth investing. The Anuroop Packaging Rights Issue Note sets the Rights Issue expectations in systematic way which tells you if Anuroop Packaging Rights Issue good to buy (good or bad / yes or no). The Rights Issue Forecast tells you weather to invest in Anuroop Packaging Rights Issue by providing Rights Issue recommendations i.e. subscribe, avoid and neutral.


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