Aaron Industries Limited IPO

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(i) The Aaron Industries Limited was founded by Mr. Amar Chinubhai Doshi in the year 2013 as a separate entity for elevator industry to provide an exceptional design in Elevator cabins and started their own journey as group Company of MOTI Group. Within the short span of time, the company has changed the elevator industry from simple cabins to extra-ordinary designer cabins.

(ii) The Company involves in Manufacturing and Trading of Elevator products and other elevator parts with the continuation of the existing business of MOTI group. Currently, they are providing all Elevator product and parts under one roof. It includes Elevator cabins, Doors, Frem, Header, Traction Machine and etc. From designing ultra-modern, up-to-the-mark cabins for luxurious properties-residential as well as commercials, they give customers an artistic edge that enhances their property and provides customer satisfaction.

(iii) The Company total revenue increased from 39.07 Lakh in FY14 to 1,179.14 Lakh in FY18, representing a CAGR of 97.67 %. Their EBITDA increased from 1.45 Lakh in FY14 to 160.73 Lakh in FY18, representing a CAGR of 156.42%.

Aaron Industries Limited IPO Stock Quote & Charts

38.10

0.00%

  • Open: 38.00
  • High - Low: 38.10 - 38.00
  • Previous Close: 38.10
  • Total Traded Volume: 6000
  • Updated On: 12-Nov-2018

Objects of the Aaron Industries Limited IPO:

Objective of Aaron Industries Limited IPO are: a. To set up a new line of business in expansion plan b. To meet the working capital requirement c. To meet the Public Issue Expenses

Aaron Industries Limited IPO Details:

Open Date: Aug 20 2018
Close Date: Aug 24 2018
Total Shares: 1,257,000
Face Value: ₹ 10 Per Equity Share
Issue Type: Fixed Price Issue IPO
Issue Size: 4.776 Cr.
Lot Size: 3000 Shares
Issue Price: ₹ 38 Per Equity Share
Listing At: NSE Emerge
Listing Date: Sep 03 2018

Promoters And Management:

Promoters of Aaron Industries Limited Company are: 1. Mr. Amar Chinubhai Doshi 2. Mr. Karan Amar Doshi 3. Mr. Monish Amarbhai Doshi 4. Ms. Radhika Amar Doshi 5. Ms. Toral Karan Doshi 6. Ms. Bhoomi Monish Doshi

Capital Structure:

(i) Authorized Share Capital 50,00,000 Equity shares at FV@10) 5 Cr
(ii) Issued, Subscribed,& Paid-up Share Capital Before Issue (35,25,838 Equity Shares at FV@10) 3.525 Cr
(iii) Present Issue ( 12,57,000 Equity Shares at FV@10) 1.257 Cr
(iv) Reservation for Market Maker 63,000 Shares at FV@10) 6.3 lacs
(v) Reservation for QIB & HNI 5,97,000 Equity Shares at FV@10) 50%
(vii) Reservation for Retail 5,97,000 Equity Shares at FV@10) 50%
(viii) Paid Up Share Capital after the issue 4.782

Financials of Aaron Industries Limited IPO:

1. Assets and Liabilities Key Parameters
Year Asset(lacs) Liabilities(lacs) Net Worth(lacs) Book Value D/E (<2) RONW Receiveable days
FY14 38.72 36.88 1.84 18.40 20.04 46% 225
FY15 106.48 100.98 5.5 55.00 18.36 67% 93
FY16 220.8 196.96 23.84 12.79 8.26 16% 83
FY17 255.41 226.41 29 15.39 7.81 17% 53
FY18 692.61 336.40 356.21 18.94 0.94 30% 48
Post Issue 833.87 17.43 0.40 13%
2. Profit n Loss Key Parameters
Year Revenue(lacs) PAT(lacs) EBITDA Margins Profit Margins Outstanding Shares(lacs) EPS
FY14 39.07 0.84 3.8% 2.1% 0.100 8.40
FY15 237.81 3.66 3.2% 1.5% 0.100 36.60
FY16 331.89 3.86 4.3% 1.2% 1.864 2.07
FY17 480.31 4.94 5.3% 1.0% 1.884 2.62
FY18 1,179.14 107.03 14.4% 9.1% 18.804 5.69
Post Issue 47.828 2.24
3. Cash Flow Statement(all figures in lacs)
Particulars FY18 FY17 FY16 FY15 FY14
(i) Net Cash Generated from Operation 0.05 -5.64 -91.28 -15.21 7.05
(ii) Net Cash Generated from Investment -151.59 -3.39 -1.62 -2.25 -5.83
(iii) Net Cash Generated from Financing Activity 158.88 2.61 93.32 22.07 2.06
(iv) Total[ (i)+(ii)+(iii) ] 7.34 -6.42 0.42 4.61 3.28
(v) Cash and Cash Equivalents at the Beginning of the Year 1.91 8.32 7.9 3.29 0
(vi) Cash and Cash Equivalents at the end of the Year 9.25 1.90 8.32 7.90 3.28
Key Notes: a) The Revenue is growing at CAGR of 134.39% from FY14 to FY18. b) The PAT is growing at CAGR of 235.95% from FY14 to FY18. c) Don't get excited with the CAGR growth of Revenue and PAT, as this growth is mainly due to remarkable performance shown in FY18 which is bit surprising though. d) The Annualized EPS[ Post Issue] =2.24 d) P/E(post issue)= 17[ High]. e) P/B(post issue)= 2.18 f) D/E(post issue) =0.40( Ideal) g) Mcap/Sales(ideally <2)= 1.541 on FY18 sales(Inline). h) The Company's EBITDA Margins was in the range of 3-5% until FY17, but surprisingly it has raised to 14% in FY18[ Bit Confusing] i) In spite of showing 20 fold increase in PAT in FY18 as compared to last year, the cash flow from operation is only Rs.5000. Attributing mainly due to an increase in inventories from 1.49 Cr in FY17 to 3.32 Cr in FY18. This clearly shows the operational inefficiency of the company.[Big Negative]

Comparison With Peers:

We believe that none of the listed companies in India offer products or services across the various business segments in which Aaron Industries operate.

Recommendation on Aaron Industries Limited IPO:

Review and Recommendation of Aaron Industries Limited IPO from our IZ Team is:3/10 [ The Surprised jump of 20x in PAT in FY18 as compared to last year is hard to digest. The Inventories too has jumped to 3.32 Cr in FY18 as compared to 1.49 Cr in FY17. The Operational inefficiencies exist in the company which can be easily verified by the fact that the in spite of showing 20x spikes in PAT, the Cash flows from operations is only 5000.] 1-5: Fair 5-7: Good 7-10: Excellent.

Lead Manager of Aaron Industries Limited IPO:

  1. Gretex Corporate Services Private Limited

Registrar of Aaron Industries Limited IPO:

  1. Bigshare Services Private Limited

Company Address:

Aaron Industries Limited B-65 & 66, Jawahar Road No. 4, Udhyog Nagar, Udhana, Surat-394210, Gujarat, India. Phone No. +91-02612278410 E-mail: info1@aaronindustries.net Website: www.aaronindustries.net

25th Sep 2018 - 27th Sep 2018 => Aavas Financiers IPO

Bid Details of Aaron Industries Limited IPO as on
24-Aug-2018 18:30:00 IST

Category No.of shares offered No. of shares bid
597,000 1,992,000
597,000 1,581,000
63,000 63,000
1,257,000 3,636,000
QIBs Yes
QIBs+HNIs Subscription 3.34X
Retail Subscription 2.65X
Total Subscription 2.99X

Discussion on Aaron Industries Limited IPO:

    Subscription figures have some issues on the NSE site. As soon as it will come will be displayed on the website.

    Apart from selling the products in India the company also engaged in export. In fiscal 2018, the revenue from exports accounted for 77.53 Lakh which is 6.6% of the total revenue. The Company exports the products to many countries namely Uganda, Kenya, and Nepal etc.

    The Company has negative Working Capital of 26 Cr for FY18. The major risk of negative working capital is:
    (i) The high risk of bankruptcy & lower creditability in banks.
    (ii) The potential risk of winding up the application by creditors.
    (iii) Lost trade discounts & bad supplier relationships etc.