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16 Nov 2024
Sheetal Universal IPO: A Harvest of Growth in Agricultural Raw Materials
Introduction:
Sheetal Universal Limited, a key player in the agricultural raw materials sector, recently made its debut in the capital market through an Initial Public Offering (IPO). The IPO, with a fixed price issue of Rs 23.80 crores, garnered substantial attention from investors. In this blog, we explore the intricacies of Sheetal Universal's journey, from bidding to listing, and shed light on its performance metrics post-IPO.
Key Dates:
| Bidding Period | December 4 to December 6, 2023 |
|---|---|
| Allotment Date | December 7, 2023 |
| Listing Date | December 11, 2023 |
IPO Highlights:
| Issue Size | Price per Share | Lot Size | Minimum Investment |
|---|---|---|---|
| ₹23.80 Crores | ₹70 | 2000 Shares | ₹140,000 for retail investors |
Financial Overview:
| Total Issue Size | Fresh Issue |
|---|---|
| 3,400,000 shares, aggregating up to ₹23.80 Cr | 3,400,000 shares |
Shareholding Structure:
| Pre-Issue Shares | Post-Issue Shares |
|---|---|
| 8,055,999 | 11,455,999 |
Market Maker Segment:
| Spread X Securities | 172,000 shares |
|---|
IPO Management:
| Lead Manager | Registrar | Market Maker |
|---|---|---|
| Beeline Capital Advisors Pvt Ltd | Bigshare Services Pvt Ltd | Spread X Securities |
Subscription Highlights:
The Sheetal Universal IPO witnessed an overwhelming subscription of 179.20 times, reflecting robust interest across various investor categories. Retail investors demonstrated significant enthusiasm with a subscription of 129.73 times, while Non-Institutional Investors (NII) exhibited an impressive subscription of 212.55 times. Qualified Institutional Buyers (QIBs) also participated actively.
IPO Journey Timeline:
| IPO Open Date | IPO Close Date | Basis of Allotment | Refunds Initiation | Shares Credited to Demat | Listing Date |
|---|---|---|---|---|---|
| December 4, 2023 | December 6, 2023 | December 7, 2023 | December 8, 2023 | December 8, 2023 | December 11, 2023 |
Lot Size Details:
Investors had the flexibility to bid for a minimum of 2000 shares, with the following investment parameters for retail investors and High Net Worth Individuals (HNIs):
| Application | Lots | Shares | Amount |
|---|---|---|---|
| Retail (Min) | 1 | 2000 | ₹140,000 |
| Retail (Max) | 1 | 2000 | ₹140,000 |
| HNI (Min) | 2 | 4000 | ₹280,000 |
Sheetal Universal IPO Reservation:
The IPO featured a reservation of 3,400,000 shares, allocating portions to Non-Institutional Investors (NII), Retail Individual Investors (RII), and Market Makers.
About Sheetal Universal Limited:
Incorporated in 2015, Sheetal Universal Limited is engaged in sourcing, processing, and supplying agricultural raw materials. The company's product portfolio includes oilseeds like peanuts and hulled sesame seeds, spices such as fenugreek seeds and cumin seeds, various grains, and other products like raisins and desiccated coconut.
The manufacturing and processing facility of Sheetal Universal is situated in Jamnagar, Gujarat, covering an area of approximately 14668 sq. mtr. The company operates two subsidiaries, namely Saumesvar International Private Limited and Svar Industries Private Limited, which are involved in exporting agricultural produce and producing, processing, and distributing agricultural products, respectively.
Financial Overview:
As of August 31, 2023, Sheetal Universal displayed a robust financial performance:
| Metric | Values |
|---|---|
| Assets | ₹4,370.03 Lakhs |
| Revenue | ₹5,826.93 Lakhs |
| Profit After Tax | ₹187.67 Lakhs |
| Net Worth | ₹1,046.89 Lakhs |
| Reserves and Surplus | ₹241.29 Lakhs |
Key Performance Indicators:
- - Market Capitalization: ₹80.19 Crores
- - Return on Equity (ROE): 36.17%
- - Return on Capital Employed (ROCE): 21.59%
- - Debt/Equity: 2.09
- - Return on Net Worth (RoNW): 30.63%
Objects of the Issue:
The funds raised through the IPO will be utilized for:
- - Funding capital expenditure. - Meeting working capital requirements. - General Corporate Expenses. - Covering public issue expenses.
Conclusion:
Sheetal Universal Limited, with its focus on agricultural raw materials, has successfully navigated its IPO journey, showcasing substantial growth in financial metrics. The company's commitment to quality sourcing and processing positions it as a key player in the agricultural sector. However, investor caution is advised, as the sudden boost in financial performance for FY23 onward has raised concerns about its sustainability. Investors, particularly those with a medium-term perspective, may consider parking funds in Sheetal Universal, given its potential for growth in the evolving agricultural landscape.
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