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Security and Intelligence Services SIS India IPO – Details & Review, Opening Date, Price Band

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SIS India is a leading provider of private security and facility management services in India.

Issue Details for SIS India IPO –  not yet announced

  • IPO Open :  31st July – 2nd Aug 2017
  • Issue Price band: Rs 805 – Rs 815
  • Issue Size:   Rs 780 crores
  • Market lot:  minimum 18 shares and in lot of 18 shares
  • Min / Max Shares for Retail:
  • Listing:
  • Book Running , Lead Managers: Axis Capital, ICICI Securities, IIFL Holdings, Kotak Mahindra

IPO Issue Allocation

  • Qualified institutional buyers (QIBs) –  50% per cent of the total issue size.
  • Non-institutional investors (NIIs) –  15% per cent of the issue size.
  • The retail quota limit in the issue = 35% 

Objective of the issue:

The initial public offer (IPO) comprises fresh issue of shares worth Rs 362.25 crore and an offer for sale of up to 51,20,619 shares by the existing shareholders. The objects for which SIS India intends to use the Net Proceeds from this IPO are as follows:

  1. Repayment and pre-payment of a portion of certain outstanding indebtedness availed by our Company;
  2. Funding working capital requirements of our Company; and
  3. General corporate purposes

Background:

Security and Intelligence Services SIS India is a leading provider of private security and facility management services in India. They have strategic relationship in India with several multinational companies. As of August 1, 2016, cvompany has a widespread branch network consisting of 229 branches in 118 cities and towns in India, which cover 605 districts. It employs 133,551 personnel in India and rendered security and facility management services at 10,224 customer premises across India.

  • second largest security services provider in India
  • second largest cash logistics service provider in India

The company operate in the following business lines:  private security services, comprising of: o security services; o cash logistics services; o electronic security; and o home alarm monitoring and response services; as well as  facility management services, comprising of: o cleaning and facility operation and management services; and o pest and termite control.

Promoters :  Shareholders

Competitors :   Nearest competitor – Quess Corp

Anchor Investors:  This will be one day before the issue opens.

Financials:

Standalone

(in crores)   2017 2016 2015 2014 2013 2012
Income   1619.9 1287.32 1056.29 824.49 582.67 464.88
Income Growth   26% 22% 28% 42% 25%  
               
Net Profit   26.55 33.91 24.64 33.21 29.9 11.05
Profit Growth   -22% 38% -26% 11% 171%  
               
Net Profit Margin   1.64% 2.63% 2.33% 4.03% 5.13% 2.38%
               
EPS     4.97 3.62 4.88    
 
Consolidated
 
(in crores)   2017 2016 2015 2014 2013 2012
Income   4577.12 3851.68 3566.08 3108.4 2658.79 2416.11
Income Growth   19% 8% 15% 17% 10%  
               
Net Profit   91.28 65.07 48.51 65.56 54.36 86.08
Profit Growth   40% 34% -26% 21% -37%  
               
Net Profit Margin   1.99% 1.69% 1.36% 2.11% 2.04% 3.56%
               
EPS   13.29 11.16 9.21 10.11    
 
 
Valuation as compared to its peers:  
At EPS of 13.29, the issue is valued at 61 times FY17 earning.  This is reasonable as compared to the nearest competitor – Quess Corp tat is currently trading at PE of 125 times.
 

Brokerage Recommendations:

   
   
   

Should you consider investing:   While the revenue has grown in last 5 years, the net profit margin is very thin (2-3%).

Given that the revenues have growth consistently and reasonable valuation, investors can consider investing in this IPO.

Disclaimer:  The articles or analysis on this website should not be constituted as Investment advice. Please consult your financial advisor before making any investments.

If you have any queries related to this article or any other personal finance query ( Investment, Taxation etc), please comment below

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The author is a Chartered Accountant and loves to write about Personal Finance, Wealth Management, Taxation etc. Disclaimer - The articles on this website is for informational and knowledge purposes and should not be treated as financial advice, Please consult your financial advisor before taking any investment decision.

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