JFL Life Sciences Limited IPO

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i. JFL Life Sciences is engaged in the business of manufacturing of pharmaceutical products. The company is engaged in domestic as well as international business. With market presence in PAN India, products of JFL is supplied to 10 developed and developing countries throughout the World. To maintain its competitiveness and to further the cause of health care JFL has laid a strong R&D foundation and a FDA approved state of the art manufacturing facility near Ahmedabad.

ii. JFL Life Sciences is a manufacturing company, so the sales strategy is to sell its products in bulk to pharmaceuticals marketers and traders who in turn provide the channel for sales to customers. The company does not sell it under any brand name and we use the same strategy for both domestic & international market.

iii. Following are the major products types:

i. Dry powder injections
ii. Tablets & Capsules (B-Lactam) solid oral dosage form.
iii. Tablet and capsules (General)
iv. Oral Rehydration Solutions (ORS)

iv. The company exports its products majorly to African countries, Middle Eastern countries and CIS countries, mainly through merchant exporters. The Company is registered with the MOH of Kenya, Nigeria, Yemen, Cambodia & Myanmar for the manufacturing of a particular product. Few of their products are also registered with Ukraine, Uzbekistan, Kazakhstan (CIS countries) through merchants.

v. Competitive Strength :

i. Product registration
ii. Experienced management and dedicated employee base
iii. Quality assurance
iv. Quality & Brand strength10

Objects of the JFL Life Sciences Limited IPO:

The Company proposes to utilize the funds which are being raised through this Issue (“Net Proceeds”) towards the following objects: a) Repayment of secured and unsecured loans b) Funding the working capital requirements of the company c) General Corporate Purposes
DRHP of JFL Life Sciences Limited IPO
RHP of JFL Life Sciences Limited IPO

JFL Life Sciences Limited IPO Details:

Open Date: Aug 25 2022
Close Date: Aug 30 2022
Total Shares: 2,978,000
Face Value: ₹ 10 Per Equity Share
Issue Type: Fixed Price Issue
Issue Size: 18.17 Cr.
Lot Size: 2000 Shares
Issue Price: ₹ 61 Per Equity Share
Listing At: NSE Emerge
Listing Date: Sep 08 2022

Promoters And Management:

i. Smiral Ashwinkumar Patel, aged 41 years, is the Managing Director and one of the promoters of the Company. He holds bachelor’s degree in business administration from Gujarat University. He also holds a master’ degree in computer science from Empire College London. He holds a diploma in computer training from ACT Computer Education and a post-graduate diploma in international business from University of Salford. He has more than 12 years of experience in the pharma industry. ii. Tejal Smiral Patel, aged 40 years, is the Whole-time Director and one of the Promoters of the Company. She holds bachelor’s degree in education (mathematics and science) from Gujarat University. She holds bachelor’s and masters degree in science (statistics) from Gujarat University. She has more than 7 years of experience in the pharma industry. iii. Manishkumar Jasvantlal Patel, aged 40 years, is the Chairman of the Board and a Non-Executive Director the Company. He is an undergraduate and has passed the higher secondary certificate examination held by Gujarat Secondary Education Board, Gandhinagar. He has more than 10 years of experience in the hospitality and travel industry.

Financials of JFL Life Sciences Limited IPO:

Particulars (in Cr) March 22 March 21 March 20
Revenue from operations 25 32 30
Cost of Material Consumed 18 28 26
Gross Margins 28.00% 12.50% 13.33%
Changes in inventories 0.02 0.14 -0.26
Employee Benefit Expense 0.97 0.97 1.25
Other Expense 0.6 0.6 0.7
Operating Profit 5.4 2.3 2.3
OPM% 21.64% 7.16% 7.70%
Finance Cost 1.50 1.23 1.16
Depreciation 0.27 0.25 0.23
Profit (Loss) for the period 2.53 0.54 0.36
EPS 2.30 0.49 0.33
 

Comparison With Peers:

Peer Vaishali Pharma is trading at P/E of 21x.

Recommendation on JFL Life Sciences Limited IPO:

Review and Recommendation of JFL Life Sciences Limited by IZ team is 4/10

1. Headquartered in Ahmedabad, Gujarat, the company is engaged in the business of manufacturing of pharmaceutical products. The product portfolio consists of Dry powder injections ( B-Lactam ), Tablets & Capsules (B-Lactam) solid oral dosage form and Tablet and capsules (general) Solid Oral Dosage Form and Oral rehydration solutions (ORS). 2. The company is engaged in domestic as well as international business. With market presence in PAN India, products of JFL is supplied to 10 developed and developing countries throughout the World. To maintain its competitiveness and to further the cause of health care JFL has laid a strong R&D foundation and a FDA approved state of the art manufacturing facility near Ahmedabad.

3. They export the products majorly to African countries, Middle Eastern countries and CIS countries, mainly through merchant exporters. The Company is registered with the MOH of Kenya, Nigeria, Yemen, Cambodia & Myanmar for manufacturing of a particular product. Few of our products are also registered with Ukraine, Uzbekistan, Kazakhstan (CIS countries) through merchants. 4. Only 1.70% of growth occurred in total revenue between FY19 and FY21, however the profit after taxes increased by 33.87% between FY19 and FY21. 5. They have 2 manufacturing units in Ahmedabad. 6. Based on the average EPS for the previous three years, the P/E ratio is 58. P/E based on earnings for FY22 is 26x, but in FY22, all of the metrics such as gross margins, operating profit margins, and net profit margins have unexpectedly increased rapidly, which has led to a lower P/E. 7. Extremely high numbers of days in receivables of 219. 

8. On January 6, 2021, the promoters issued shares at a price of Rs. 130 per share. The following year, on January 13, 2022, they issued bonus shares in the ratio of 12:1. Therefore, the final price would be Rs.10.83 for each share.

Lead Manager of JFL Life Sciences Limited IPO:

  1. GYR CAPITAL ADVISORS PRIVATE LIMITED

Registrar of JFL Life Sciences Limited IPO:

  1. Kfin Technology Private Limited

Company Address:

JFL Life Sciences Limited 309, Satyam Mall, Opp. Saman Complex, Nr. Vishweshwar Mahadev Mandir Settelite, Ahmedabad 380015 Phone: 937729 5575 Email: cs@jfllifesciences.com Website: http://www.jfllifesciences.com/

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