Anuroop Packaging Ltd IPO Closing Nov 13; Should you Invest?

Anuroop Packaging Ltd (APL), a corrugated box manufacturer based out of Wada, Thane, IPO plans to issue 2030000 equity shares of FV Rs. 10 each through the combo of fresh equity issue and OFS. Anuroop IPO plans to raise Rs.2.64 cr.

The company  will issue 19,20,000 equity shares at a price of Rs.13 per equity share, that also includes a share premium of Rs.3 per equity share. The issue constitutes 26.50% of the post issue paid-up capital of the company. The issue is solely lead managed by Gretex Corporate Services Pvt. Ltd. and Karvy Fintech Pvt. Ltd. is the registrar to the issue. Gretex Share Broking Pvt. Ltd. is the market maker for this issue.

The company provides services to various industries for corrugated packaging solutions. It has clients from stationery industry where the company deals with the industry leaders such as okuyo Camlin, A.W. Faber-Castell (India). The company’s other major clients are Himalaya Organics, Ion exchange India, Mattel Toys India, FDC, Pepe Jeans London etc.

The company also make products for industries like pharmaceutical, metals, water treatment and has in recent years started trading of Gum (Turpentine and Dipentene)

Anuroop Packaging IPO

The net proceeds will be used for Working Capital Requirements, General and Offer related expenses of the corporate

• Issue Open: November 8th, 2019 – November 13th, 2019
• Issue Type: Fixed Price Issue IPO
• Issue Price: Rs 13 Per Equity Share
• Minimum Investment: INR 130,000
• Minimum Order Quantity: 10000 Shares
• Equity Shares Offered (Fresh Issue): 3,30,000 eq shares aggregating to Rs.0.43 Crore
• Offer for sale: 17,00,000 eq shares aggregating to Rs.2.21 Crore
• Listing At: BSE SME
• Listing Date: On or Before October 16, 2019

Should you Invest?

The company has reported the posted turnover of Rs. 2.58 cr. in FY17, Rs. 3.97 cr in FY 18 and Rs.9.97 in FY 19. APL has delivered the net profits of Rs. 0.03 cr. in FY17, Rs. 0.73 cr. in FY18 and Rs. 1.79 cr. in FY19. For Q1 of FY20, it has posted a turnover of Rs. 2.78 cr. and net profit of Rs. 0.56 cr. (on a consolidated basis) and turnover of Rs. 1.94cr. and net profit of Rs. 0.40 cr. (on a standalone basis). 

If we annualized FY20 (consolidated) earnings and attribute it to fully diluted post issue equity then the company is at the P/E of around 3.17. APL’s listed peer is Worth Peripherals, which is currently trading at a P/E of around 5.3 (as on 07.11.19). Therefore, the issue pricing looks attractive with its super earnings in pre-IPO and IPO year.

The long term investors may “subscribe” to Anuroop IPO.