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12 January 2024

SAR Televenture IPO: Transforming Connectivity, Unlocking Potentia

Introduction:

SAR Televenture IPO, a book-built issue of Rs 24.75 crores, is exclusively a fresh issue of 45 lakh shares. The bidding phase spanned from November 1, 2023, to November 3, 2023. Post allotment on November 6, 2023, the shares were listed on NSE SME on November 8, 2023.

Financial Highlights:

The IPO, with a price band of ₹52 to ₹55 per share, necessitated a minimum lot size of 2000 shares, amounting to an investment of ₹110,000. As of January 12, 2024, the stock closed at ₹262.25, reflecting a 4.98% increase.

Key IPO Statistics:

- IPO Duration: November 1, 2023, to November 3, 2023
- Listing Date: November 8, 2023
- Face Value: November 8, 2023
- Price Band: ₹52 to ₹55 per share
- Lot Size: 2000 Shares
- Total Issue Size: 4,500,000 shares, aggregating up to ₹24.75 Cr
- Fresh Issue: 4,500,000 shares, aggregating up to ₹24.75 Cr
- Issue Type: Book Built Issue IPO
- Listing At: SME, NSE

Equity Dynamics:

Pre-issue, SAR Televenture Limited held 10,500,000 shares, a figure that increased to 15,000,000 post the IPO.

IPO Reservation Strategy:

The IPO allocated shares across categories, with 28.36% for Anchor investors, 18.82% for QIB, 14.43% for NII, and 33.29% for Retail investors.

Anchor Investors:

SAR Televenture IPO successfully raised Rs 7.03 crore from anchor investors on October 31, 2023. The anchor lock-in period for 50% of shares expires on December 20, 2023, and for the remaining shares, it ends on March 14, 2024.

IPO Timeline Highlights:

- IPO Open Date: Wednesday, November 1, 2023
- IPO Close Date: Friday, November 3, 2023
- Basis of Allotment: Monday, November 6, 2023
- Initiation of Refunds: Tuesday, November 7, 2023
- Credit of Shares to Demat: Tuesday, November 7, 2023
- Listing Date: Wednesday, November 8, 2023
- Cut-off time for UPI mandate confirmation: 5 PM on November 3, 2023

Lot Size Landscape:

Investors had the flexibility to bid for a minimum of 2000 shares and in multiples thereof. The table below outlines the investment parameters for retail investors and HNIs:

Application	Lots	Shares	Amount
Retail (Min)	1	2000	₹110,000
Retail (Max)	1	2000	₹110,000
HNI (Min)	2	4,000	₹2,20,000

Promoter Holding Perspective:

M.G. Metalloy Private Limited is the sole promoter, holding 87.80% of shares pre-issue.

Company Profile:

SAR Televenture Limited is a telecom solutions provider, specializing in the installation and commissioning of 4G and 5G Towers, Optical Fibre Cable (OFC) Systems, and network equipment trading. Registered as Infrastructure Provider Category I (IP-I) with the Department of Telecommunication (DOT), the company leases build sites and establishes and maintains assets such as Dark Fibres, Right of Way, Duct Space, and Towers.

Financial Performance Snapshot:

As of June 30, 2023:

- Assets: ₹4,324.77 Lakhs
- Revenue: ₹1,735.35 Lakhs
- Profit After Tax: ₹192.38 Lakhs
- Net Worth: ₹3,324.40 Lakhs
- Reserves and Surplus: ₹3,114.40 Lakhs
- Total Borrowing: ₹752.18 Lakhs

Key Financial Indicators:

- Debt/Equity: 0.65
- RoNW: 32.95%
- EPS (Rs): 91.08
- P/E (x): 10.72

Objects of the Issue:

The net proceeds from the issue are allocated for:
1. Installation of 5G/4G towers. 2. Repayment and/or prepayment of certain outstanding secured borrowings. 3. Funding working capital requirements. 4. General Corporate Purposes (GCP).

Expert Analysis:

The issue, based on FY24 annualized earnings, appears reasonably priced, offering potential medium to long-term rewards.

IPO Subscription Status:

As of November 3, 2023, the SAR Televenture IPO witnessed an overwhelming subscription of 288.09 times. Robust responses were seen in the QIB (77.00 times), NII (715.77 times), and Retail (222.10 times) categories. The total number of applications reached 166,575, reflecting a subscription of 222.10 times.

Note: All financial figures are in INR (Indian Rupees), and market-related data is as of January 12, 2024.

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