Adishakti Loha and Ispat Limited IPO
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i. Initially, the Company was incorporated with the object of managing, undertaking, carrying on, and engaging in the business of Real Estate Development, Land Development, and associated activities. The Company altered the main object clause of its Memorandum of Association vides shareholders in 2019, to enable it to pursue the business of trading in metals.
ii. The Company is engaged in the business of trading in metals with its core focus on trading in Iron and Steel.
iii. Company works on the B2B model, it does not have any inventory as goods are directly supplied to the customers from dealers.
Competitive strengths
i. Experienced and qualified management team
ii. Existing client and supplier relationships
Objects of the Adishakti Loha and Ispat Limited IPO:
The objects of the present issue of Equity Shares are:
a. To meet the incremental working capital requirements
b. To meet General Corporate Purpose
Adishakti Loha and Ispat Limited IPO Details:
| Open Date: | Sep 30 2021 |
| Close Date: | Oct 05 2021 |
| Total Shares: | 1,820,000 |
| Face Value: | ₹ 10 Per Equity Share |
| Issue Type: | Fixed Price Issue |
| Issue Size: | 2.00 Cr. |
| Lot Size: | 10000 Shares |
| Issue Price: | ₹ 11 Per Equity Share |
| Listing At: | BSE SME |
Promoters And Management:
i. Mr. Pawan Kumar Mittal, is the Promoter Director of the Company. He is a member of the Institute of Chartered Accountants of India. Apart from the above, he holds a Bachelors’ Degree in Commerce from Delhi University and is a qualified Cost and Management Accountant. He is a Practicing Chartered Accountant by profession and has more than 21 years of experience in the field of finance and taxation. He is responsible for the overall management of the Company.
ii. Mrs. Kiran Mittal, is Director of the Company and is also one of the constituents of the Promoters’ Group of the Company. She is a member of the Institute of Cost and Works Accountant. Apart from the above, she also holds a Bachelor’s degree in Commerce from Delhi University. She oversees the administration department of the Company and possesses more than 21 years of experience.
iii. Mr. Jai Bhagwan Aggarwal, is a Non-Executive Independent Director of the Company. He is a Retired Banker and has more than 4 decades of experience. He holds a Bachelors’ Degree in Arts from Punjab University.
Financials of Adishakti Loha and Ispat Limited IPO:
| Particulars (in Lakhs) | Mar 21 | Mar 20 |
| Revenue from operations | 1128 | 1094 |
| Purchase of stock | 1095 | 1075 |
| Employee Benifit Expense | 15 | 3 |
| Other expenses | 24 | 17 |
| Operating Profit | -6 | -1 |
| OPM% | -0.53% | -0.09% |
| Other Income | 9 | 0.00145 |
| Finance costs | 0 | |
| Depreciation and amortization | 1 | |
| Profit before tax | 0.53 | -0.94 |
| Profit for the year | .3 | -2 |
| EPS | 0.01 | -0.45 |
Comparison With Peers:
Company has shown below peers in the listed market.
1. Kanishk Steel Industries Limited = Trading at P/E of 5.33x and Revenue (FY21) = 250 Crores
2. Rathi Bars Limited = Trading at P/E of 14.5x and Revenue (FY21) = 325 Crores
3. Sharda Ispat Limited = Trading at P/E of 10x and Revenue (FY21) = 95 Crores
And Adishakti Loha and Ispat Limited is coming up with an IPO at P/E of 1527x and having revenue of just 11 Crores.
Recommendation on Adishakti Loha and Ispat Limited IPO:
Review and Recommendation of Adishakti Loha and Ispat by InvestorZone is 1/10
1. It is a pure trading company and company is making loss at operational level. This means they are not able to make money from its trading business.
2. Asking price of Rs.11 is a joke. They are asking P/E of 1576x.
3. Almost NIL profit.
Lead Manager of Adishakti Loha and Ispat Limited IPO:
Registrar of Adishakti Loha and Ispat Limited IPO:
Company Address:
Adishakti Loha and Ispat Limited
Plot 3, Shop 325,
DDA Community Centre, Aggarwal Plaza,
Rohini, New Delhi 110085
Phone: +91-11-27860681
Email: info@adishaktiloha.com
Website: http://adishaktiloha.com/
Discussion on Adishakti Loha and Ispat Limited IPO:
2 Comments
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Avoid..
Total Outstanding Shares Before IPO = 27,38,000
Total Shares to be issued in IPO = 18,20,000
Total Outstanding Shares after IPO = 45,58,000
PAT = 33000
EPS = 0.0072
P/E = 11/0.0072 = 1572x….