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  • Writer's pictureJatin Agarwal

Bizotic Commercial IPO


Company and IPO Overview:

The company manufactures, designs, and markets ready-to-wear clothes for men, including Formal Wear, Casual Wear, Party Wear, Fit Wear, Sports Wear, Comfort Wear, Ethnic Wear, and Winter Wear. It serves its consumers through retail locations and e-commerce channels.


Cutting, stitching, sewing, finishing, inspection, and packing are all part of the company's garment production process. It periodically outsources the entire garment manufacturing process to third-party contractors on a job-by-job basis and provides technical specifications such as designs, pattern, quality, fabric, and so on to them, who procure the necessary raw materials at their own expense and begin the manufacturing process based on the company's specifications.


In the fiscal year 2017-2018, the company opened its first retail outlet under its own brand name "URBAN UNITED" in Ajmer, Rajasthan. Urban United is a premium lifestyle company in the retail sector and one of India's fastest-growing men's fashion companies. Urban United has evolved into a one-stop shop for men's clothes. From 2017 to 2020, it has opened approximately 40 franchised locations in Rajasthan and Haryana only.


Bizotic Commercial is a BSE SME IPO and the company is about to raise around ₹ 42.21 crores via IPO. The price of the IPO is fixed at ₹ 175 with a market lot of 800 shares. The retail quota is 50% and NII is 50%.


Financials (rounded off):

Date

Total Revenue (₹ in cr)

​​​PAT (₹ in cr)

​31/03/2020

11.14

0.16

31/03/2021

16.80

0.34

31/03/2022

53.42

0.60

31/12/2022

37.49

2.90


Objectives of the Issue:


1. Setting up Retail stores

2. Repayment of loan

3. Working capital requirement

4. Meeting Public Issue Expenses


IPO Details:

IPO Date

12/06/2023-15/06/2023

Face Value

₹10 per share

IPO Price Band

₹175 per share

IPO Lot Size

800 Shares

Listing at

BSE SME

Basis of Allotment

20/06/2023

Credit of Shares in Demat

22/06/2023

Listing Date

23/06/2023

Pre-Issue Shareholding

-

Post-Issue Shareholding

-

Retail Minimum Lot Size

800 shares (₹1,40,000)


Valuations & Margins:

Indicators

FY 20

FY 21

FY 22

EPS

0.3

0.63

1.11

P/E

-

-

157.66

ROCE (%)

24

38

22

EBITDA (%)

2.8

4.08

1.72

Debt/Equity

2.59

1.33

2.08


Important things to note:


1. There is an in-house design team that works on design projects based on the client's preferences.

2. Skilled management staff.

3. It serves a diverse consumer base through a well-established marketing setup.

4. A small number of clients account for a sizeable portion of the company's revenue.

5. The company has debtor issues, and failure to recover the existing debt will have an impact on its operations and financial performance.

6. Many of its franchisees have not signed franchise agreements.


Crisp Insights:

  • Current Grey Market Premium is NIL.

  • This IPO looks 'risky' in terms of valuations. Investors need to be a bit more cautious here.



Disclaimer: All information is provided for educational and informational purpose only. Data is fetched from publicly available sources such as the DRHP filed by the company. The website or the author takes no guarantee for the accuracy of the data however, we have tried our best to present accurate data to out readers. Please consult a financial advisor or do your own analysis before investing/trading in the stock market.


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