SMC Credits RI review - (Avoid)

•    SMCCL is in the finance-related service segment. 
•    Its financial data is just on a minuscule level.
•    The counter has not marked any trades since June 1997.
•    Simply stay away from this at-par issue. 

ABOUT COMPANY:
SMC Credit Ltd. (SMCCL) is promoted by Focal Leasing and Credits Limited. As an NBFC it is involved in providing financial services and not accepting any public deposits. The company is a non-banking finance company duly registered with the Reserve Bank of India and has Investments in Shares & Loans and Advances to corporate entities, and source of Income includes Dividends on Investments, Interest on Loans, and Profit from Share Trading. Besides this, the Company also has rental income on its Fixed Assets/Building. 

ISSUE DETAILS:
To part finance its need for augmenting capital base (Rs. 11.25 cr.), and general corporate purpose (Rs. 3.52 cr.), SMCCL is coming out with the right issue (RI) of 15033300 equity shares of Rs. 10 each at par value to mobilize Rs. 15.03 cr. It is offering 3 shares for every 2 shares held by eligible shareholders as of the record date of November 25, 2022. The issue opens on December 12, 2022, and will close on December 19, 2022. The full amount is to be paid on application. Post allotment, shares will be listed on BSE. SMCCL is spending Rs. 0.26 cr. for this RI process. 

Sandae Capital Advisors Pvt. Ltd. is the sole lead manager for this issue while Beetal Financial & Computer Services Pvt. Ltd. is the registrar of the issue 

Post RI, SMCCL's current paid-up equity capital of Rs. 10.02 cr. will stand enhanced to Rs. 2.51 cr. Based on the RI pricing, the company is looking for a market cap of Rs. 2.51 cr.

FINANCIAL PERFORMANCE:
On the financial performance front, for the last two fiscals, SMCCL has posted a total income of Rs. 5.16 cr. / Rs. 4.50 cr. (FY21), Rs. 5.24 cr. / net profit of Rs. 2.59 cr. (FY22). FY21 net profit is after deferred tax credit of Rs. 2.23 cr. 

As per unaudited results filed with the exchange, it has earned a net profit of Rs. 0.41 cr. on a total income of Rs. 1.83 cr. for H1 of fY23 ended on September 30, 2022. 

DIVIDEND POLICY:
The company has no track records on the BSE Website about its dividends. It may adopt a prudent dividend policy post-listing of RI, based on its financial performance and future prospects.

SCRIP PERFORMANCE: BASED ON BSE WEBSITE DATA: SCRIP CODE: 532138 (FV Rs. 10).
Aho Ascharyam, this counter has no track record as per BSE WEB. It has had no quotes since June 1997. It marked the last quote at Rs. 11.25 as of May 20, 1997. Thus a company that has no quotes on the Exchange is being permitted for fresh fundraising. Since the last three quarters, the promoter's holding has remained constant at 13.98%. This scrip turned ex-right on November 25, 2022, but has no quotes on cum-right or ex-right basis and even as of writing this review i.e. December 08, 2022.