SAR Televenture Limited IPO

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1. Core Services: The company’s primary services include the installation and commissioning of telecommunication towers, including 4G and 5G towers. They also work with optical fiber cable (OFC) systems, which are essential for transmitting telecommunications signals and transporting voice and data traffic.

2. Network Equipment: In addition to tower installation and OFC systems, the company is involved in the sale of network equipment. This could include various components and hardware needed for the operation and maintenance of telecommunication networks.

3. Certifications and Registrations: The company holds ISO 9001:2015 certification, indicating a commitment to quality management. They are also registered as an Infrastructure Provider Category-I (IP-I) with the Department of Telecommunication (DOT). This registration permits them to lease and manage their infrastructure assets and provide them to licensees of telecom services.

4. Infrastructure Assets: The company owns and manages various telecommunication infrastructure assets, such as GBT/RTT/Pole sites and Outdoor Small Cell (ODSC) sites. They also have assets like dark fibers, right of way, duct space, and towers. These assets are leased or rented to Telecom Network Operators and other stakeholders in the industry.

5. Support Services: The company offers a range of support services, which include project management for laying ducts and optic fiber cables, construction of basic transmission and telecom utilities, dark fiber leasing, optical fiber network construction, and maintenance of ducts and optic fibers. They also provide optical fiber project turnkey services to Telecom Network Operators, Broadband Service Operators, and ISPs.

6. Geographic Reach: The company has a presence in multiple regions, including West Bengal, Bihar, Uttar Pradesh, and Punjab. They have provided an aggregate of 373 towers on lease in these areas, highlighting their footprint and relevance in the telecommunications infrastructure industry.

7. Passive Infrastructure Provider: The company operates as a passive telecommunication infrastructure provider, focusing on the installation and commissioning of towers and the use of OFC systems. “Passive infrastructure” typically refers to the physical assets that support the active components used in telecommunication services. This model allows them to serve as a vendor for Telecom Service Providers (TSPs) by offering cost-effective and quality services.

8. Industry Presence: The company has gained a presence in the telecommunications industry as a Telecom Service Provider (TSP) vendor. This signifies their role in providing critical infrastructure and services to telecom network operators.

Competitive Strengths

i. Growing presence in telecommunications Circles with high growth potential
ii. Experienced and dedicated senior team across key functions
iii. Efficient Business Model

Objects of the SAR Televenture Limited IPO:

The company intends to utilize the net proceeds from the issue towards the funding of the following objects: i. Installation of 5G/4G towers. Full or part repayment and /or prepayment of certain outstanding secured borrowings (including foreclosure charges, if any) availed by the company. Funding the working capital requirements of the company. General Corporate Purposes (GCP).
DRHP of SAR Televenture Limited IPO
RHP of SAR Televenture Limited IPO

SAR Televenture Limited IPO Details:

Open Date: Nov 01 2023
Close Date: Nov 03 2023
Total Shares: 4,500,000
Face Value: ₹ 2 Per Equity Share
Issue Type: Book Built Issue IPO
Issue Size: 24.75 Cr.
Lot Size: 2000 Shares
Issue Price: ₹ 52 - 55 Per Equity Share
Listing At: NSE Emerge
Listing Date: Nov 08 2023

Promoters And Management:

i. Rahul Sahdev, aged forty- seven (48) years, is the Chairman & Managing Director of the Company. He holds a degree in Advance Diploma in Business Management from National Business Management College, Australia. He holds a degree in Diploma in Marketing Department from Australian International College of Business also he holds the degree of Master of Business Administration in Marketing from Sydney University. He is associate with the Company since February 02, 2023. He has 18 years of experience in the field of marketing. Currently he looks after marketing and business development in the Company. ii. Praveen Tandon, aged fifty (50) years, is the Executive Director and Whole-time Director of the Company. He holds a degree in Bachelor in Engineering from Nagpur University. He has over 25 years of experience in Procurement of Passive Infrastructure, Electronics, Project Management, Marketing, and Customer Services Sales in Telecom Sector. He is expert in supervising logistics operations & ensuring timely execution, while adhering to transit guidelines and also demonstrated excellence in handling contracts, closure of deals, Contract Management. He is having depth knowledge in Contract Negotiations, Closure and Vendor contract management. He has been involved in Customer Contract management and Account management during Tenure with wellknown Companies iii. Chandra Prakash Srivastava, aged fifty-six (57) years, is the Non-Executive Director of the Company. He holds BE (Production & Industrial Engineering), Allahabad in 1987. During his 36 years of experience, he acted as Telecom Sourcing & Business Development Veteran, having worked with most of the Telecom Companies in India at the Senior Management level. He has moved into an entrepreneurial role and he has been providing the consulting services to various companies associated with Telecom. He has been associated with the Company since June 30, 2023.

Financials of SAR Televenture Limited IPO:

Particulars ( In Lakhs )
2021
2022
2023
3M-FY24
Revenue from Operations 91 473 3,246 1,732
Other Income 0 2 5 3
Total Revenue 91 475 3,252 1,735
Cost of Material Consumed 0 0 2,115 1,324
Employee benefits expenses 35 126 137 32
Other Expenses 45 285 424 117
EBITDA 11 65 576 262
Depreciation & Amortisation 10 41 103 51
Finance Cost 4 22 45 11
EBIT 1 24 473 211
OPM (%) 11.91% 13.74% 17.71% 15.08%
PBT -3 3 427 200
Tax 0.1 -1 39 7
PAT -2.7 4 388 192
NPM (%) -2.99% 0.78% 11.94% 11.09%
No.of Shares 150 150 150 150
EPS -0.02 0.02 2.58 1.28
 

Comparison With Peers:

Name of the Company Revenue (In Crore) PAT (In Crore) EPS ( in Rs) P/E CMP Mcap (In Crore)
SAR Televenture Limited 32 3.9 2.58 21.2 55 83
Suyog Telematics Limited 144 46 44.18 18.1 810 853
Kore Digital Limited 21 3.2 12.78 19.7 302 106
* All the data is as per FY23.

Recommendation on SAR Televenture Limited IPO:

Reviews and Recommendation of SAR Televentures SME IPO by IZ team is 4/10 1. Nature of Business SAR Televentures is engaged in the business of tower installation, primarily serving major telecom players like Airtel and Vodafone. 2. Company Inception The company was established in 2019. 3. Revenue Growth The revenue for the past three years (2021, 2022, 2023) has been 0.9 Cr, 4.72 Cr, and 6.42 Cr respectively. 4. Acquisition In January 2023, the company acquired a UAE-based firm that specializes in fiber laying and tower trading. This subsidiary contributed approximately 26 Cr to the revenue in FY23. 5. Market Competition The sector in which SAR Televentures operates is highly competitive, with numerous players in the market. No distinct competitive advantage or 'moat' is visible. 6. Cash Flow The company has a negative cash flow. 7. Valuation The asking market capitalization is 82 Cr, with a P/E ratio of 22x, which is considered high. 8. Key Takeaways 1. Revenue Diversification: The acquisition of the UAE-based company appears to be a strategic move to diversify revenue streams, given its significant contribution to the total revenue. 2. High Valuation Concerns: The high asking market cap and P/E ratio could be a point of concern, particularly given the negative cash flow and the lack of a competitive moat in a saturated market. 3. Operational Efficiency: The negative cash flow could indicate issues with operational efficiency, which potential investors should scrutinize further. 4. Sector Competition: The intense competition in the sector raises questions about the company's ability to sustain and grow its market share. Conclusion Given the company's recent acquisition and its significant impact on revenue, prospective investors may find this to be a positive signal. However, the high valuation, coupled with negative cash flows and intense market competition, suggest that caution should be exercised. Thorough due diligence is recommended before making any investment decisions.

Lead Manager of SAR Televenture Limited IPO:

  1. Pantomath Capital Advisors Private Limited

Registrar of SAR Televenture Limited IPO:

  1. Skyline Financial Services Private Ltd

Company Address:

SAR Televenture Limited P.No – 346A, 2nd Floor Udyog Vihar, Phase-4, Gurugram - 122016 Phone: 0124 - 45133283 Email: info@sarteleventure.com Website: https://sarteleventure.com/

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