Reblog: Review IndoStar Capital Finance Limited IPO


After a lull in the month of April 2018, long wait for main board IPO for financial year 18-19 is over with a non-banking finance company breaking the ice with its float of around Rs. 1850 crore. Details of the first main board IPO of this fiscal is given hereunder:

Indostar Capital Finance Ltd. (ICFL) is a leading non-banking finance company (“NBFC”) registered with the Reserve Bank of India as a systemically important non-deposit taking company. It is a professionally managed and institutionally owned organization which is primarily engaged in providing bespoke Indian Rupee denominated structured term financing solutions to corporate and loans to small and medium enterprise (“SME”) borrowers in India. ICFL recently expanded its portfolio to offer vehicle finance and housing finance products. Although, the company operated in a challenging credit environment in the initial years of our business operations business has experienced growth since the commencement of operations in 2011. Between fiscal 2013 and 2017, its total credit exposure, total revenue and net profits grew at a CAGR of 30.0%, 31.4% and 23.7% respectively. Its corporate lending business which was at 99.8% in FY 2015 declined to 76.8% for the period ended 31.12.17 and for the said periods, its SME lending business grew from 0.2% to 22.7%. Vehicle financing operations started from November 2017 and housing finance operations started from March 2018.

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Reblog: Lemon Tree Hotels Ltd. IPO Review


Lemon Tree Hotels Ltd. (LTHL) is India’s largest hotel chain in the mid-priced hotel sector, and the third largest overall, on the basis of controlling interest in owned and leased rooms, as of June 30, 2017, according to the Horwath Report. It is the ninth largest hotel chain in India in terms of owned, leased and managed rooms, as of June 30, 2017, according to the Horwath Report. LTHL operates in the mid-priced hotel sector, consisting of the upper-midscale, midscale and economy hotel segments. Company seeks to cater to Indian middle class guests and deliver differentiated yet superior service offerings, with a value-for-money proposition. The company opened our first hotel with 49 rooms in May 2004 and as on 31.01.2018 it had 4,697 rooms in 45 hotels (including managed hotels) across 28 cities in India. On the said date it has 662992 members in loyalty programme as “Lemon Tree Smiles” and the number is continuously rising.

LTHL aims to be India’s largest and most preferred chain of hotels and resorts in each of the upper-midscale, midscale and economy hotel segments. Due to the dynamic and evolving nature of Indian guests’ expectations and based on its market research, company has created three brands in order to address these three hotel segments: (1) ‘‘Lemon Tree Premier’ which is targeted primarily at the upper-midscale hotel segment catering to business and leisure guests who seek to use hotels at strategic locations and are willing to pay for premium service and hotel properties; (2) “Lemon Tree Hotels” which is targeted primarily at the midscale hotel segment catering to business and leisure guests and offers a comfortable, cost-effective and convenient experience; and (3) “Red Fox by Lemon Tree Hotels” which is targeted primarily at the economy hotel segment.

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Reblog: Bandhan Bank IPO review


Bandhan Bank Ltd. (BBL) a microfinance company that got RBI license in 2015 for Bank has transited itself into a bank on 23rd August 2015. It had the mandate to bring IPO within three years of starting banking operation; it is coming much before that with its maiden IPO. BBL is a commercial bank focusing on serving underbanked and underpenetrated markets in India. Bandhan Bank has a banking license that permits it to provide banking services pan-India across customer segments. It currently offers a variety of asset and liability products and services designed for micro banking and general banking, as well as other banking products and services to generate non-interest income.

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Reblog: Bharat Dynamic IPO review


Bharat Dynamics Ltd. (BDL) is one of the leading defense PSUs in India engaged in the manufacture of Surface to Air missiles (SAMs), Anti-Tank Guided Missiles (ATGMs), underwater weapons, launchers, countermeasures and test equipment. It is the sole manufacturer in India for SAMs, torpedoes, ATGMs and also the sole supplier of SAMs and ATGMs to the Indian armed forces. Additionally, it is also engaged in the business of refurbishment and life extension of missiles manufactured. BDL is also the co-development partner with the DRDO for the next generation of ATGMs and SAMs. It currently has three manufacturing facilities located in Hyderabad, Bhanur and Vishakhapatnam. BDL enjoys Mini Ratna (Category – 1) status.

Off late Foreign Direct Investment (FDI) rates have increased in sectors like defense, insurance and other sectors. Under the ambit of the ‘Make in India’ initiative, investment procedure, license applications, declarations and other processes has been streamlined to boost investor confidence. Applications for permits have been digitized and a new uniform tax regime (Goods & Services Tax) has been implemented to reduce complexity in taxation. The nation also has a vibrant micro, medium and small enterprise (MSME) sector to support manufacturing units set up in India. The MSME sector is expected to perform a vital support function to the manufacturing sector and will be crucial to India’s agenda to raise the share of manufacturing in India’s GDP from 16% to 25% by the end of 2025. The central government, as well as state governments, are also trying to incentivize domestic and foreign players to ramp up defense manufacturing in India through a combination of tax benefits, infrastructure incentives, and other methods. The Indian defense market is in a state of transition, as a result of new policies promulgated by the government. BDL is in the process of setting up to new plants – one at Hyderabad, AP and another at Amaravati – Maharashtra.

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Reblog: H G Infra Engineering Ltd. IPO Review


H G Infra Engineering Ltd. (HGIEL) is an infrastructure construction, development and management company with extensive experience in focus area of road projects, including highways, bridges and flyovers. Its main business operations include (i) providing engineering, procurement and construction (“EPC”) services on a fixed-sum turnkey basis and (ii) undertaking civil construction and related infrastructure projects on item rate and lump sum basis, primarily in the roads and highway sector. It has also forayed into executing water pipeline projects and is currently undertaking two water supply projects in Rajasthan on a turnkey basis which includes the designing, construction, operation and maintenance of the project. HGIEL enjoys accreditations, such as the ISO 9001:2015, ISO 14001:2004, OHSAS 18001:2007 certification for quality management systems, environment management systems, and health and safety management systems, respectively, issued by LMS Assessment Services Private Limited.

HGIEL has executed or is executing projects across various states in India covering Rajasthan, Uttar Pradesh Haryana, Uttarakhand, Maharashtra and Arunachal Pradesh. During the last five years, Company has completed 13 projects above the contract value of Rs. 40 crore in the roads and highways sector aggregating to a total contract value of Rs. 1674.89 crore, which included construction, improving, widening, strengthening of two and four lane highways, construction of high-level bridge and construction of earthen embankment, culverts and cart track underpasses. As on November 30, 2017, Company has 21 ongoing projects in the roads and highways sector which includes construction, improving, widening, strengthening, up gradation and rehabilitation of two, four and six-lane highways construction of high-level bridge and construction of road network. HGIEL’s order book for these ongoing projects in the roads and highways sector amounted to Rs. 3585.31 crore as on November 30, 2017, accounting for 96.70% of its total Order Book. As of November 30, 2017, it had a total Order Book of Rs. 3707.81 crore, consisting of 21 projects in the roads and highways sector, four civil construction projects and two water supply projects.

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Reblog: Aster DM Healthcare IPO Review


Aster DM Healthcare Ltd. (Aster) is one of the largest private healthcare service providers which operate in multiple GCC states based on the number of hospitals and clinics and an emerging healthcare player in India. GCC states that comprise the United Arab Emirates, Oman, Saudi Arabia, Qatar, Kuwait and Bahrain. It also operates in Jordan and Philippines. Aster is having operations in different verticals and geographies. It has already started work for 10 new hospitals, 5 in GCC states and 5 in India. Although it has a larger portion of revenues coming from GCC states, due to India based company, it has registered office in the southern region and is mulling listing in India. Asters hospitals in India are located in Kochi, Kolhapur, Kottakkal, Bengaluru, Vijaywada, Guntur, Wayanad and Hyderabad. These are operated under “Aster”, “MIMS”, “Ramesh” or “Prime”, “Aster Aaadhar” and “Aster CMI” brands. Its clinics are located at Kozhikode, Eluru and Bengaluru. As of 30.09.17 the company had 17408 employees including 1417 full-time doctors, 5797 nurses, 1752 paramedics and 8442 other employees. In addition, it had 891 “fee for service” doctors.  Aster has a diversified portfolio of healthcare facilities, consisting of 9 hospitals, 90 clinics and 206 retail pharmacies in the GCC states, 10 multi-specialty hospitals and 7 clinics in India, and 1 clinic in the Philippines as of September 30, 2017. Overall currently it has total 323 operating facilities.

Majority of Aster hospitals and clinics provide secondary and tertiary healthcare services to patients. In addition to providing core medical, surgical and emergency services, some of its hospitals provide complex and advanced quaternary healthcare in various specialties, including cardiology, oncology, radiology, ophthalmology, neurosciences, pediatrics, gastroenterology, orthopedics and critical care services. Aster had plans on the table for more large hospitals in metros of India before the budget, but now it mulls affordable hospitals in tier –II and tier- III cities and in rural areas. No plans have been firmed up so far in this regard.

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Reblog: Amber Enterprises India Limited IPO Review


Amber Enterprises India Ltd. (AEIL) is a niche player in functional component manufacturing segment that is used widely by Room Air Conditioner (RAC) manufacturers. The company enjoys preference of eight out of 10 mega players in the field and is getting more new customers that are entering in this field as under While Goods penetration among users has vide difference as far as ACs are concerned. While TV, Fridge and Washing Machines enjoys penetration of over 10% to 60% in India, AC penetration is as low as around 4% and thus this segment has vide scope of advancement going forward.RAC penetration in neighboring countries ranges from 30 to 100%. Its customer includes Panasonic, LG, Daikin, Hitachi, Whirlpool, Voltas, Blue Star and Godrej. The company is a market leader in Indian RAC, OEM/ODM segments and has comprehensive product portfolio to suit the requirements of its customers. AEIL has 11 manufacturing facilities at 7 strategic locations and thus enjoys proximity of its prime customers. To stay tuned with the futuristic requirements, it keeps spending on R&D and backward integration. In last five years, it made two acquisitions i.e. PICL in 2012 and IL Jin in 2017 and is now able to offer maximum solutions under one roof. It enjoys “Make in India” status and helps India in reducing imports from China and other countries. While increasing temperature will bring more demand, adequacy of power supply help for the faster advancement of RAC markets domestically. As per Frost and Sullivan report, RAC and OEM/ODM markets are set to post CAGR of 12.4% and 25.1% respectively by 2022. AEIL enjoys a market share of 19.1% in RAC and 55.4% in OEM/ODM segments respectively. AEIL’s customers command around 75% of the Indian RAC market share.

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Reblog: Astron Paper IPO review


Astron Paper and Board Mills Ltd. (APBM) is engaged in manufacturing of kraft paper and catering to the packaging industry. It has a current capacity of 96000 mt p. a. Post proposed expansion plans, its total installed capacity will stand increased to 129000 mt p. a. Its manufacturing and dispatch process has been assessed and certified ISO 9001:2015 and ISO 14001: 2015 by SGS United Kingdom Ltd. It is using waste paper as its main raw material and thus saving the usage of wood, thus following green initiative. APBM’s kraft paper is used by packaging industry in manufacturing corrugated boxes, liners, sacks and composite containers.

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Reblog: Future Supply Chain IPO review


Future Supply Chain Solutions Ltd. (FSC) is one of India’s largest organized third-party logistics service operators. It offers automated and IT-enabled warehousing, distribution and other logistics solutions to a wide range of customers. Company’s service offerings, warehousing infrastructure, pan-India distribution network, “hub-and-spoke” transportation model and automated technology systems support its competitive market position. FSC’s customers operate in various sectors across India, including retail, fashion and apparel, automotive and engineering, food and beverage, fast moving consumer goods (“FMCG”), e-commerce, healthcare, electronics and technology, home and furniture and ATMs. According to management, its business model enables it to act as a service provider that can comprehensively cover customers’ supply chain needs. It currently operates with 14 hubs, 106 branches and dedicated containerized fleet of 526 vehicles. Its Mihan-Nagpur distribution center is the most modern and highly automated one.

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Reblog: Shalby Ltd IPO review


Shalby Ltd. (Shalby) is one of the leading multi-specialty chains of hospitals in India. Its hospitals are tertiary care hospitals, few of which also offer quaternary healthcare services to patients in various areas of specialization such as orthopedics, complex joint replacements, cardiology, neurology, oncology, and renal transplantations. As on the date of RHP, Shalby provided inpatient and outpatient healthcare services through 11 operational hospitals with an aggregate bed capacity of 2,012 beds. As on June 30, 2017, it had nine operational hospitals with an aggregate operational bed count of 841 beds. Shalby that has earned name and fame for joint replacement had a 15% market share of all joint replacement surgeries conducted by private corporate hospitals in India in 2016. As on the same date, it also provided outpatient services through 47 Outpatient Clinics and has ten shared surgery centres within third party hospitals, which are called “Shalby Arthroplasty Centre of Excellence” (“SACE”), where Shalby offers orthopedic healthcare services including surgeries. Since March 2007, it has conducted an aggregate of 92100 surgeries, and provided healthcare services to an aggregate of 1025533 patients, consisting 133652 inpatients and 891881 outpatients. Indian healthcare industry that was around Rs. 9.2 trillion in 2016 is expected to grow at a CAGR of around 15-16% to reach Rs.17.2 trillion by 2020.

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