IPO Review - Discussion until listing

Moksh’s funding cost is 15%. As a fallout of PNB scam, funding for jewelry sector could dry out. Working capital funding is vital for survival and growth of the business. In the circumstances, it is prudent to wait for annual results and then decide.

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Hi @Yogesh_s

Just wanted to check, are you planning to study Bandhan Bank IPO, if yes please do share your inputs.

Regards,
Ashish

also anyone on some shrimp exporters getting ready for IPO likes of Devi foods and many VIzag based exports have filled ipo with sebi…any info pls share

Yogesh Sir,

May you please review Sirca Paints IPO.

Thanks

Some comments on IndoStar Capital Finance (Mostly negative)

Note: All screenshots are sourced from IPO prospectus.

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Sirca paints’ numbers look good, products, opportunity size is also good and company’s future plans indicate that it is on a right track. Receivables are on the higher side but so far it has not resulted in a debt pile up so not a concern for now but something to watch out for. Valuations looks OK too,

What I was unable to find in the prospectus is company’s best selling products and sales break up including historical data. ‘Our Business’ section is full of future plans as if company has nothing to write about its past. Historical numbers are good but I could not find out how did the company manage to get these numbers. There is a lot of information about company’s products but that looks like a copy-paste job rather than an attempt to communication useful and company specific information to future shareholders.

Since this is a distribution company, I was looking for specific information about number of distributors, geographical spread of distributors, historical number of distributors, sales/distributor, future plans about growth of the network etc.

Since I was unable to find out details of primary sources of income, I did not dig further. Will not apply for IPO.

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@Yogesh_s
Could you please review SME IPO Innovation facade
TIA

Company hasn’t been able to grow its book value from internal accruals over the last 5 years. All the growth in book value has come from raising additional equity. If a company has done well in the past, it should reflect as a growth in book value.

Company’s products and services are good with good potential but I do not invest based only on potential. company should have demonstrated the ability to capture the opportunities and convert them into profits which is lacking in this company.Will check back in an year.

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@Yogesh_s Thanks for all the wonderful posts. Its of great help to the valuepickr community.

I would like to get your thoughts on Capacite Infra Projects which got listed last year. Promoters with vast experience. They have been growing at tremendous pace. Marquee set of clients like Oberai, Lodha, Godrej etc with more repeat orders. Sector also seems to be recovering after RERA and Demonetization.

My notes on Capacite are here

However, I am concerned about link between Capacite and Pratibha Industries and slowing growth in revenue.

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Sorry for my negligence. Thanks for the pointing the appropriate post. Its helpful.

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Views also invited on Indostar IPO getting listed on Monday,PBV of 1.9 ,Retail book at 23% getting increased to 50%. New team under ex STFC R Sridhar has taken charge.Founded by PE players n has got a good professional team running it.Risks are high exposure to Corporate n Real estate sector.

http://www.capitalmarket.com/pub/nim/nimshow.asp?code=42128

Anyone applying for HDFC AMC IPO ?? Looks like valuation are at premium compared to other AMC .

Yes, but the hdfc brand always command premium and maintains performance.However it’s performance in current year may be somewhat subdued due to the market conditions and lack of interest in mutual funds and SIPs.

Dear All. This is with reference to the Embassy Office Parks REIT IPO.

Since it is the first REIT ipo I wanted to get some opinions and advise on the thoughts of experienced members.

Any opinions and advise @dd1474 @8sarveshg @hitesh2710 @bheeshma @Yogesh_s

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As per this article - https://economictimes.indiatimes.com/markets/ipos/fpos/embassy-office-park-reit-ipo-kicks-off-should-you-subscribe/articleshow/68458957.cms?frm=mailtofriend&intenttarget=no

7-8 per cent is the expected rental income, another 2-3 per cent is expected from rental increase and 4-5 per cent from capital appreciation

Given the indicative yield of 8.25 per cent, the REIT could be a good investment for those investors who are looking for better returns than bank fixed deposits in next 5-7 years, but it does have its own share of risks. Analysts said the product in no way is a substitute for fixed deposits and one must adopt caution while subscribing.

It might be better to wait and watch and pick it up in secondary market if rental yields look to move north.

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Just came across a reasonable thread on the Embassy IPO

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Hi @valuestudent

Not evaluated the pros and cons yet. However, rental yields tend to be around 7% in commercial and capital appreciation is very slow if at all. Commercial real estate is doing well and there may be a case for peak rentals in the commercial space.

Commercial rentals (and hence rental yields) are more volatile in India compared to the rest of the world. That said there is an immense shortage of high grade commercial space in India and clients are sticky and willing to pay top dollar.

Everything put together it could a good investment for someone looking for 10-12% ROI over 10 years. Anything more than that is not sustainable in my view.

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@valuestudent
Only point which need special attention in tweet thread is how is arriving at post interest yield of 6.5%? Point 24-29 twits. I believe from presentation made by the investment manager that yield are what would accrue to investor (pre tax) are around 8.5% for FY20. The difference in yield is substantial and need explanation. Either my understanding is incorrect or Mr. Manoj Nagpal has mis understood the key terms.

Discl: I would wait for REIT to listed and then observe and does not intend to participate in IPO. My view may be biased and my understanding may be incorrect. Investors shall do their own due diligence before making any decisions.

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