Vera Synthetic Limited is engaged in manufacturing of Fishing Nets, PP Yarns,PP /HDPE Ropes, PP Twines and Niwar. company manufacture and market our products under our flagship brand “Sujlon”. Our products are primarily used in fishing sector and other allied use thereon. The company is promoted by Sunil Makwana and Nagin Makwana. They joined the Company in 2008 and at present looking after the overall management, day to day affairs and are the guiding force behind the strategic decisions of our Company. company manufacturing facility is divided into two units namely Division I and Division II (both situated in the same premises at Mamsa, Gujarat). the manufacturing unit is well equipped with required facilities and machinery to facilitate the smooth manufacturing process. the company also have in-house testing machines to test our products. our dealers, traders, and distributors spread across different regions of the Country thus giving us the advantage of wide geographical presence. Currently, the company sells their products either directly to traders/fishermen or through our distribution network in Gujarat, Maharashtra, Kerala, Karnataka, Andhra Pradesh, West Bengal, Delhi, Bihar, Rajasthan, etc. The Company has two group companies:
1. Suraj Filaments Pvt Ltd
2. Vera Nets Pvt Ltd
The company is issuing 13,35,000 number of shares at price of Rs.40 per share to raise 5.34 cr. The breakup of fund is detailed below:
1. Funding the working capital requirements of the Company= 3.84 cr
2. General corporate purposes= 1 cr
3. Issue Expense= 50 lakh
(i) Sunil Makwana, aged 31 years, has been re designated as the Chairman and Managing Director of the Company w.e.f October 10, 2017. He holds a Bachelor degree in Commerce from Swami Sahajanand College of Commerce & Management, Bhavnagar affiliated with Bhavnagar University. He is the guiding force behind all the corporate decisions and is responsible for the entire business operations of the Company since his appointment.
(ii) Nagin Makwana, aged 38 years, has been re designated as the Whole Time Director of company w.e.f. October 10, 2017. He has been on the Board of Directors of the company since 2008. He has completed his Graduation in Business Administration from K S School of Business Management, Ahmedabad
affiliated with Gujarat from University and he holds Master of Business Administration degree with specialization in Finance from the same college . His scope of work includes handling the financial and day to day operations of our company.
Authorized Share Capital
( 70,00,000 shares at FV@10)
Issued, Subscribed,& Paid-up Share Capital Before Issue
(36,00,000 Shares at FV@10)
(13,35,000 Shares at FV@10)
Reservation for Market Maker
(69000 Shares at FV@10)
Net Issue to Public
(13,35,000-69000= 12,66,000 Shares)
Retail Quota(<2 Lkah)[6,33,000 Shares]
HNI & QIB Quota(>2 Lakh)[6,33,000 Shares]
Paid Up Capital after the issue
Financials of Vera Synthetic Limited IPO as per DRHP:
1. Balance Sheet Snippet[ All Calculation for FY 16-17]
(i) Shareholders’ Fund[Equity] Value
(v) Net Worth(Asset- Liability)
(vi) RONW(PAT/Net Worth)
2. Profit n Loss Snippet
(i) The Revenue of the company is inconsistent in last 4 years which does not augur well for future growth.
(ii) PAT of the company is also showing the same trendline as revenue and to top of that the company has incurred loss of tune to 1.03 cr for the first 6 month ending Sept 2017 which is almost equal to last 5 years combined profit.
(iii)Margins(PBT/Reveune): 2.2 to 2.6% in last 4 years. The company has low margin business.
(iv) Annualized EPS(post issue)= (-4.41)
(v) Annualized P/E(post issue)=(-9) at the cutoff price of 40
3. Cash Flow Statement
The company is not generating positive cash flow continuously in the preceding years which does not augur well for future growth.
Comparison With Peers:
As per DRHP the company is facing competition from Garware Wall Ropes Limited which is listed at both BSE/NSE in mainboard and trading at PE of 23 on the basis of Mar' 17 earnings.