top of page
  • Writer's pictureJatin Agarwal

Shera Energy IPO


Company and IPO Overview

The company Shera Energy Limited started its operations in 2009, The Company is primarily engaged in the business of manufacturing of winding wires and strips made of non-ferrous metals primarily Copper and Aluminium. Company also manufactures wire rods, wires and tubes of Copper and Brass. These wires, tubes and rods are manufactured in various shapes and sizes as per the requirement of the customers and / or demand in the market. Its product range includes paper covered wires, enamel and fiber covered wires, round wires, rectangular wires, bunched wires, tubes, rods, strips, etc.

Shera Energy Limited is an ISO 9001:2015, ISO 14001:2015, and ISO 45001:2018 certified company. The company has well-equipped manufacturing facilities with latest technology plant and machinery for manufacturing and quality control lab within house testing equipment to test the quality of its products. Its finished products undergo a strict quality check to ensure that they are of required quality as per the standards set. Its in-house testing team regulates and monitors the quality, safety and packaging of the products.

Shera Energy Limited is an NSE SME IPO and it is going to raise ₹35.20 crores via IPO. The price band is fixed at ₹55to ₹57 with a market lot of 2000 shares. The company has reserved a quota of 15.84% for NII, 35.74% for Retail Investors and 48.42% for QIB in this IPO.


Financials (rounded off)

Date

Total Revenue (₹ in cr)

​​​PAT (₹ in cr)

​31/03/2020

426

3.61

31/03/2021

423

5.03

31/03/2022

525

7

Objectives of the Issue

· The company is raising the funds in order to meet its working capital requirements and other general corporate purposes.


IPO Details

IPO Date

07/02/2023-09/02/2023

Face Value

₹10 per share

IPO Price Band

₹55-57 per share

IPO Lot Size

2000 Shares

Listing at

NSE SME

Basis of Allotment

14/02/2023

Credit of Shares in Demat

16/02/2023

Listing Date

17/02/2023

Pre-Issue Shareholding

66.57%

Post-Issue Shareholding

63.51%

Retail Minimum Lot Size

2000 shares (₹1,14,000)


Shera Energy Valuations and Margins:

FY20

FY21

FY22

EPS (Rs.)

1.81

2.52

3.51

P/E

-

-

15.67-16.24

ROCE (%)

26.47

27.4

26.78

EBITDA (%)

6.87

7.73

6.42

Important things to note about the company:

This IPO seems to be a mixture of some negatives and positives:-

Positives:

· Revenue is consistent.

· Profit growth is quite good.

Negatives:

· PE based on FY22 earnings is 18.5. Net profit margins are 1.2% on average for the last 3 years. Competitors are trading in the range of 14 to 18 PE. The issue size is very big and the majority of it is OFS. A SME should focus on expansion rather than promoters encashing IPO amount.

· Borrowings are on higher side. Adani is biggest example of over leveraging.

· Profit margin is very thin (only around 1%), though revenue is quite large.


Crisp Insights:

  • Adani Stocks have made the broader markets weak, hence, any negative news there can severely impact these small IPOs

  • Grey Market Premium is Rs.11.

  • The Company received good over-subscription as on 09/02/2023.


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.

23 views0 comments

Recent Posts

See All
bottom of page