MRC Exim IPO Review: Should You Invest?

MRC Exim IPO Review: Should You Invest?

With loads of IPO entering  the primary market, there comes a question whether investing in such IPOS are profitable or not. Till now, we have covered a review on several IPO including the most hyped Shalby IPO and now we bring forth the details of MRC EXIM IPO.  This article will answer the questions like whether this IPO is on the radar with the investors. Whether it will guarantee high returns? Will it catch traction of the investors for some time now?

Business Description of MRC Exim Ltd

MRC Exim Ltd is engaged in offering diverse products to its customers. Its forte lies in trading of various metals, alloy, and industrial products including iron and steel. The company commenced its operations in 2016. Here’s a look at what it offers:-

  • Industrial Products- Pipes, Transmitters, Conductor, water pumps
  • Alloys and metal products- Graphite, Cobalt, Aluminum sections, steel pipe, tool steel

The company directly buys the products from the manufacturers and sells it to the corporate and clients. The promoters of the company ate Krit Kumar Shah and Chandu K Jain.

Details about the MRC Exim IPO Subscription

The IPO will open on 6th December 2017 and will close on 8th December 2017.  The face value of the share will be Rs 10 and the minimum lot that an investors needs to invest is 8000 shares and multiples thereon.  The proceeds will be used to finance its working capital requirements and to gain an edge over the unlisted peers in the market.

The issue is managed by Inventure Merchant Banker Services Ltd and Purva Shareregistry India Pvt Ltd. The company has also issued bonus shares in proportion of 3 for 2 in August 2017. Post IPO,its current equity capital will be raised from 7.42 crore to 10.42 crore.

MRC Exim IPO details
Subscription Dates 6 – 8 Dec 2017
IPO Price band INR15 per share
Fresh issue 3,000,000 shares (INR4.5 crore)
Offer for sale Nil
Total IPO size 3,000,000 shares (INR4.5 crore)
Minimum bid (lot size) 8,000 shares
Face Value  INR10 per share
Retail Allocation 50%
Listing On BSE SME platform 

A look at the financials

The company has reported a profit of Rs 4.09 crore for FY 2016 and 16.70 crores for FY 2017. The earnings per share are reported at INR 0.53 and price to earnings ratio is 28.24 and return on net worth is 1.59% and net asset value is Rs 25.19 per share. According to DRHP, the company has managed to improve its total revenue by 4 times from FY 2016 and their profits has increased by 6 times, thus raising a positive sentiment among the investors.

Should investors invest in it?

Being a startup company, very few financial details are available for the analysis, but we can say that this IPO is good for investors with an appetite for high risk and for cash- rich investors.

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