Thread by @ChintanParikh10

#sabar #SMEIPO

Biz
-Mfg of all kinds of Flexible packaging materials used for packing Food, Dairy, cosmetics, pharma, Chemical & agriculture products etc
- multi-color pouches, stand-up pouches, zip-lock pouches, vacuum pouch, paper bag, e-commerce bag, etc.
- 92 emp

1/n

Biz
- 3 prod, Multilayer films, Printed laminates, & flexible packaging prod (pouches & bags).
-Customers Meghmani Org, Sabar Dairy, Baba Ramdev Salt Refinery, Sheetal Ice cream, Arbuda Ind, Pushp Henna, Moli Heena , Kashmirilal & Sons, Bhagwati Food , Prince Gruh Udyog etc.

2/n

Biz
- Mfg plant is owned, close 2 RJ
- getting biz interest from southern india & Nepal
- Plans 2 start pharma packaging
Capacity Utilization @ 55%

Issue
- 407 lots, 100% fresh issue
- 78% of IPO proceeds for wcap
- Promoter Pre Issue holding 53.25% & Post issue 39%

3/n

Peers
-Uflex, Paper Products ltd, Flexituff Intl., Radha Madhav Corp, & Uma Converters Ltd
-Feels similar to Clara

- Several public shareholder in the company pre-IPO

4/n

Good
- Rev increased in 21 & flatish in 2022
- Cap. utilization around 56% so room for growth with current capex
- PE is low at around 8.6 based on weighted Avg EPS

Bad
- OPM in single digit
- Pre Issue holding is 53.25% which dilutes to 39% post issue
- Borrowings at 25 cr

5/n

Bad
- Related party tx is high bet. grp companies esp Sales and Purchases
- 37 lakhs tax has been deferred in Mar 22
- very high trade recievables

6/n

Bad
- IPO proceeds are drop in a bucket for Wcap so not sure whats the real purpose behind the IPO
- Had negative OCF in 20 and 21

Subx - shaping up good. GMP heard so Subx will pick up on last day. i will decide on last day looking at HNI subx

#sabar
I am applying