Thread by @MarketLearner_

Syrma SGS #IPO analysis📊

What does the company do?
Should you apply?

Everything answered in this🧵

#SyrmaSGS #StockMarket #Invest #Investing #Stocks #Investment

@mystock_myview @KommawarSwapnil @kuttrapali26 @harrie007 @TheFactFindr @anand1377 @suru27 @sahil_vi

(1/17)

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First of all, lets look at the issue details🗒️🗒️

👉Fresh issue of equity shares aggregating upto Rs 766 crores & offer for sale of 3,369,360 equity shares.

👉Issue size of Rs 836-840 crores with price band of Rs 209-200 & bid lot of 68 shares & in multiples.

👉Issue opens on 12/08/2022 & closes on 18/08/2022

(2/17)

👉Objectives of the issue include Funding capex requirements for R&D + manufacturing facilities (403 crores) ; Funding working capital requirements (131.58 crores) & General corporate purposes.

👉Their PE ratio works out to be 41.9x vs Industry average of 65.5x.

(3/17)

Now, lets try to know about the company🏣🏣

👉Syrma is leading Electronics system design & manufacturing (EDSM) company.

👉1st in India to make Radio frequency identification (RFID) products & also lead the industry.

👉Also leaders in memory modules.

👉They have 11 manufacturing facilies and 3 R&D facilities.

(4/17)

👉Syrma offers product design, rapid prototype, PCB assembly, Box build, automation tester and repair & network services.

👉They also offer OEM RFID tags, inlay solution and high frequency magnetic components.

(5/17)

Now, lets try to know about the management🧑‍🤝‍🧑🧑‍🤝‍🧑

👉Sandeep Tandon, the executive chairman has 18 years of experience in the electronics manufacturing sector. He has previously been associated with Celetronix Inc, USA.

👉Anil Nair, Independent director has 25 years of experience in the IT & consulting sector.

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👉Jayesh Doshi, the non-executive director has previously been associated with Dalmia Bharat Limited as a whole time director & chief financial officer.

👉Hetal Gandhi, Independent director has 35 yrs experience in financial services & management consultancy sector.

(7/17)

Now, lets have a look at their business model💰💰

👉Syrma is an engineering & design company engaged in turnkey electronics manufacturing services (EMS) specialising in precision manufacturing for Industrial appliances, automotive, healthcare, consumer products & IT Industries.

(8/17)

👉They are one of the leading Printed circuit board assemblies (PCBA) manufacturers in India. They are also amongst the top key global manufacturers of custom RFID tags.

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👉Unlike traditional OEM business model which only focuses on certain stages of the product process, Syrma's business model starts from the product design & navigates the entire value chain and lifecycle management & support.

(10/17)

Now, lets have a look at the company's product portfolio & customers🛍️🛍️

👉Printed circuit based assemblies (PCBA)

👉Radio frequency identification (RFID)

👉Electromagnetic & Electromechanical parts, motherboards, DRAM modules, solid state drives, USB drives & other memory products.

(11/17)

👉Their products serve to industries like automotive, healthcare, IT, industrial appliances, energy management, water purification, power supply and consumer products industries.

👉Some of the marquee customers include TVS motor, Eureka forbes, Hindustan Unilever.

(12/17)

Now, lets dig deeper🔎🔎

👉India's electronics market is expected to grow at CAGR of 25.5% from FY21 to FY26.

👉The domestic production of electronics is around 74% in FY21 which is expected to reach 96% in FY26.

👉Competition in EMS market is moderate, top 3 companies have 28.5% market share.

(13/17)

👉They have been provisionally selected for incentives under PLI for Telecom & Networking products.

👉They have also been provisionally selected as beneficiaries for incentives being granted under PLI for white goods (ACs & LED lights)

(14/17)

👉Company is focused on vertical integration in its manufacturing process. They manufacture various electromagnetic component parts, such as transformers & chokes, which are required for the manufacture of its PCBA products.

👉They export their products to 24 countries.

(15/17)

👉Some of the industries that Syrma intends to add to its portfolio by looking at the market size & outlook are Lightning (expected CAGR of 49.2% from FY21-26), Medical electronics (expected CAGR of 42.8% from FY21-26), Aerospace & Defense.

(16/17)

👉My personal view - The company looks fairly priced with promising growth aspects in the future. I think it should do well in the long term. I don't think much listing gains are possible looking at current market & IPO conditions.

(17/17)

I hope you thread helped you in analysing Syrma SGS IPO. This is not any investment advice, kindly do your own research before arriving at any decision. Please don't forget to follow us on telegram as well. telegram.me/TheMarketLearn…

Thanks for reading,
The Market Learner