Virtuoso Optoelectronics Limited IPO

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i. Virtuoso Optoelectronics manufacture consumer durable goods and assemble a wide array of products and provide end-toend product solutions. Under the OEM model, we manufacture and supply products basis designs developed by the customers, who then further distribute these products under their own brands. Under the ODM model, in addition to manufacturing, we conceptualize and design the products are then marketed to their customers’ perspective customer under their brands. The company has developed ODM capabilities with respect to lighting products and small appliances

ii. Their current product portfolio of consumer goods includes
i. Split Air Conditioners;
ii.  Water Heaters;
iii.  LED Lighting products; and
iv. other miscellaneous products such as injection molding components for air conditioners.

iii.  Virtuoso Optoelectronics offers innovative solutions to its customers, which include leading international and national consumer brands. Their comprehensive solution suite includes global sourcing, fabrication of components and parts, captive manufacturing and assembly, quality testing, packaging and logistics support, which enables us to partner with leading consumer goods brands in India. Their key customers include leading brands in Air Conditioning & Water Heater segments

iv. Competitive Strengths:

i. Infrastructure and Integrated Manufacturing Facility.

ii. Culture of innovation and highly experienced and young management.

iii. Constant focus on developing new and innovative products.

iv. Economies of Scale.

v. R&D and product design capabilities lead to ODM business generation.

vi. Availability of Performance Linked Incentives.

vii. Strong relationships with a diverse top-tier customer base.

 

Objects of the Virtuoso Optoelectronics Limited IPO:

The company proposes to utilize the Net Proceeds from the issue towards the following objects: 1. Funding the incremental working capital requirements of the Company. 2. General corporate purposes.
DRHP of Virtuoso Optoelectronics Limited IPO
RHP of Virtuoso Optoelectronics Limited IPO

Virtuoso Optoelectronics Limited IPO Details:

Open Date: Sep 02 2022
Close Date: Sep 07 2022
Total Shares: 5,400,000
Face Value: ₹ 10 Per Equity Share
Issue Type: Fixed Price Issue
Issue Size: 30.24 Cr.
Lot Size: 2000 Shares
Issue Price: ₹ 56 Per Equity Share
Listing At: BSE SME
Listing Date: Sep 15 2022

Promoters And Management:

i. Sukrit Bharati, aged 33 years, Promoter and Managing Director of the Company, appointed on September 11, 2015 as Director of the Company. Further he was appointed as Managing Director of the company on April 14, 2021. A qualified technocrat with education background of Masters in Science - Engineering Technology from BITS Pilani and diploma courses in Management subjects from Harvard Business School and NMIMS, Mumbai. Further, he has completed a certification course from the Seed Transformation Program, which is a yearlong, on-the-ground leadership program for established founders and CEOs in emerging economies focused on growing their businesses and increasing the positive impact they have in their communities. ii. Vishrut Bharati, aged 28 years, appointed on September 11, 2015 as Director of the Company. Further his designation was regularized and changed to Non- Executive Director of the company on April 14, 2021.He has completed his Bachelor of Business, Administration (BBA) from Maharashtra Institute of Technology, Pune. He has strong marketing and management skills. He has been working with the company and helping shape its business and activities since its inception. He has more than six years of experience in the line of business. iii. Abhinav, aged 32 years, is an Independent Director of the Company. He has been completed his Bachelor of Engineering (Honours) Manufacturing and Master of Science. (Technology) Engineering Technology from Birla Institute of Technology and Science, Pilani. Abhinav started his carrier as a Business Consultant with ZS Associates India Pvt Ltd, with a track record of working with more than 7 Fortune 500 companies in the pharmaceutical domain. Presently, Abhinav is a Business and Strategy Consultant, primarily dealing with Manufacturing Operations, Enterprise Resource Planning, Energy, and Lighting Consulting. He is a Co-Founder to funded startups in Healthcare and Mobile Technology domains and now helps startups with digital marketing and product strategies. He is a member of an Nʹ O - WAYS-We & You for Child Education and Relief.

Financials of Virtuoso Optoelectronics Limited IPO:

Particulars (in Cr) March 22 March 21 March 20
Revenue from operations 200 115 68
Cost of Material Consumed 171 102 56
Gross Margins 14.50% 11.30% 17.65%
Changes in inventories 0.44 -3.27 0.64
Employee Benefit Expense 3.61 2.71 1.03
Other Expense 4.35 1.27 1.7
Operating Profit 20.6 12.3 8.7
OPM% 10.30% 10.69% 12.76%
Finance Cost 9.1 7.4 4.78
Depreciation 5.1 2.34 1.43
Profit (Loss) for the period 6.4 2.6 2.5
EPS 3.1 1.25 1.21

Comparison With Peers:

Peers shown as Dixon and Amber in the DRHP. But the scale and other things are not comparable.

Recommendation on Virtuoso Optoelectronics Limited IPO:

Review and Recommendation of Virtuoso Optoelectronics Limited IPO by IZ Team is 

1. They manufacture consumer durable goods and assemble a wide array of products and provide end-toend product solutions. They serve under both original equipment to OEMs and ODM (Original Design Manufacturer). They have two manufacturing facilities which are strategically located in and around Nashik (Maharashtra) and they also has R&D centre. 2. They manufacture products on the basis designs and developed by the customers, who then further distribute these products under their own brands 3. The current product portfolio of consumer goods includes (i) Split Air Conditioners; (ii) Water Heaters; (iii) LED Lighting products; and (iv) other miscellaneous products such as injection molding components for air conditioners 4. The industry in which the company is working is getting good support from Government under PLI Scheme. 5. Revenue has increased from 68 Crores in Fy20 to 200 Crores in Fy22. 6. PAT has grown from 1.40 Crores in Fy20  to 3.94 Cores in Fy22. 7.  EPS of FY22 is Rs. 3.1 per share and P/E is 18x (looks reasonable). 

Lead Manager of Virtuoso Optoelectronics Limited IPO:

  1. Fedex Securities Limited

Registrar of Virtuoso Optoelectronics Limited IPO:

  1. Cameo Corporate Services Limited

Company Address:

Virtuoso Optoelectronics Limited Plot No. 7 M.I.D.C. Satpur, Nasik, 422007 Phone: 025 3235 0461 Email: info@voepl.com Website: https://www.voepl.com/

Discussion on Virtuoso Optoelectronics Limited IPO:

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