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Aditya Consumer Marketing SME IPO – Details & Review

aditya-ipo

Aditya Consumer Marketing, has announced its SME IPO and the IPO is opened on 29-Sep for subscription. 

Issue Details of Aditya Consumer Marketing IPO:  

  • IPO Open :  29th Sep to 5th Oct 2016
  • Issue Price: Rs 15 per share
  • Issue Size: Rs 6 crores
  • Minimum Bid – 8000 shares
  • Maximum Bid – 8000 shares
  • Minimum Investment:  Rs 120000
  • Book Running Lead Managers :  Guiness Corporate Advisors
  • Registrar – Cameo Corporate Services Ltd
  • Listing: The shares will be listed on SME platform of BSE.

Background:

Aditya Consumer Marketing Ltd (Incoporated in 2002) operate and manage chain of supermarkets under 9to9 brand name in Bihar, India.  They also operates

  • fine dining restaurants providing multi-cuisine foods and beverages on franchise basis under the Yo! China brand name;
  • salon and spa services under 9to9 brand name;
  • banquet and conference halls for corporate events and private parties such as birthday, marriage ceremony, anniversaries etc. under 9to9 brand name; and
  • fast food take away outlets under Take-Away-Expres brand name.

Those supermarkets retail fast moving consumer goods, essential household goods, fruit and vegetables, processed packaged and processed foods, clothes, cosmetics, perfumes, dairy products, toys, etc.

Aditya Consumer have six supermarket stores; six salon and spa outlets; two take away outlets; and four banquet and conference halls at various locations of Patna in the state of Bihar, India.

See more details in IPO prospectus – https://www.sebi.gov.in/cms/sebi_data/attachdocs/1474967654933.pdf

Objective of the issue:

  • Renovation of Supermarket, Restaurant, Salon & Spa;
  • To meet the working capital requirements of the Company;
  • General Corporate Expenses & Issue Expenses.

Financials:

  2016 2015 2014 2013 2012
           
Revenue 628.1 592.35 530.22 441.71 350.63
Revenue Growth 6% 12% 20% 26%  
           
Profit 18.06 7.15 6.77 5.31 4.77
Profit Growth 153% 6% 27% 11%  
           
EPS 2.19 0.87 0.82    
  • P/E ratio based on the Basic & Diluted EPS, as restated for FY 2015-16 –   6.85
  • P/E ratio based on the Weighted Average EPS, as restated – 9.87

Valuation as compared to its peers:  There are no listed peers which are in similar businesses.

Should you invest: 

Company has decent revenue growth and good growth in Profits. However, I am not very comfortable about the company focussing on many different businesses and not focussed on core business. Also there is lot of competition from unorganised sector in these areas.

So investors can avoid 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.

 

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