City Crops Agro Limited IPO - Review, Valuation & Todays GMP

City Crops Agro Limited - Complete Overview

Founded in 2013, City Crops Agro Limited, originally established as "Bhagya Agro-Care Private Limited," is primarily involved in the trade of various products, including seeds and agricultural commodities such as Rice, Wheat, Onions, Potatoes, Tomatoes, Isabgol, and Pulses.

The company procures these agricultural products from manufacturers through advance payments and then distributes them to its network of distributors. 

Additionally, City Crops Agro Limited engages in contract manufacturing by leasing agricultural land for the cultivation of Cucumbers, Onions, and Castor to meet market demand. Currently, the company manages approximately 47.31 acres of land for agricultural production.

With a team of 8 employees, the company achieved a revenue of Rs 2461.10 lacs in the financial year 2023.

 

What does the company do? 

City Crops Agro Limited is primarily involved in the trade of various products, including seeds and agricultural commodities such as Rice, Wheat, Onions, Potatoes, Tomatoes, Isabgol, and Pulses.

 

Company Products 

Seeds and agricultural commodities such as Rice, Wheat, Onions, Potatoes, Tomatoes, Isabgol, and Pulses.

 

 

IPO Overview 

The City Crops Agro Limited IPO date is set to open on September 26, 2023, and close on September 29, 2023, with an expected listing date of October 10, 2023. 

The City Crops Agro Limited IPO price is fixed at Rs. 25 per share, based on a face value of Rs. 10 per share. The total issue size for this upcoming SME IPO amounts to Rs. 15.00 Crores. 

In terms of allocation, the company has designated 50% of the shares for retail investors and the remaining 50% for other investors.

 

City Crops Agro Limited IPO timetable (Tentative)

Events	Date
IPO Opening Date	26 September 2023
IPO Closing Date	29 September 2023
IPO Allotment Date	5 October 2023
Refund initiation	6 October 2023
IPO Listing Date	10 October 2023

 

City Crops Agro Limited IPO Details 

IPO opening & closing date	26 September to 29 September 2023
Face value	Rs.10 per Share
Issue Price	Rs.25 per Share
Lot Size	6000 Shares
Price of 1 lot	Rs.150,000
Issue Size	6,000,000 Shares (aggregating up to Rs. 15.00 Cr)
Offer for sale	NA
Fresh issue	6,000,000 Shares (aggregating up to Rs. 15.00 Cr)
Listing at	BSE SME
Issue Type	Fixed Price Issue IPO
Registrar	Skyline Financial Services Private Ltd

 

City Crops Agro Limited IPO Lot Details 

Minimum Lot Investment (Retail)	1 Lot
Maximum Lot Investment (Retail)	13 Lot
Minimum Lot Investment (HNI)	2 Lot

 

City Crops Agro Limited IPO Reservation

Other Investors share Portion	50%
Retail Investors share Portion	50%

 

Company Financial

Amount in Lakhs

Period	31 Mar 2021	31 Mar 2022	30 Sep 2022
Total Assets	246.99	1,298.96	1,357.09
Total Revenue	348.90	1,775.69	962.72
PAT	4.32	48.41	61.31
Net worth	5.08	1,077.14	1,138.49
Reserve & Surplus	4.08	45.50	106.81
Total Borrowings	0.51	5.01	2.01

 

Breakup of the Top Five and Top Ten Customers

Particulars	FY23 (In %)	FY22 (In %)	FY21 (In %)
Top 5 Customers	57.93	71.46	95.75
Top 10 Customers	83.24	92.05	100.00

 

Objective of the Issue 

The company plans to allocate the net proceeds for the following purposes:

• Addressing the company's working capital needs.
• Supporting general corporate endeavours.
• Covering the expenses associated with the issuance.

 

Promoters and Management of City Crops Agro Limited

Mr. Kaupilkumar Hasmukhbhai Shah and Mrs. Shitalben Kaupilkumar Shah are the promoters of the company.

Pre-issue Promoter Shareholding	86.51%
Post-issue Promoter Shareholding	54.70%

 

Peer Comparison

Below are the listed peers of CCAL

Company Name	EPS (in Rs.)	P/E Ratio
CCAL	1.13	22.03
MK Exim (India) Ltd	6.78	16.88
Alstone Textiles (India) Ltd	9	2.89

 

IPO's Valuations

To assess the IPO valuation, we can make use of the information presented in the company's DRHP. City Crops Agro Limited IPO price has been set at ?25 per share, and the EPS is recorded at 1.13. Consequently, based on the issue price, the company's P/E ratio is calculated to be 22.12.

 

Dividend Policy

According to the CCAL IPO DRHP, the company has not issued any dividends in the past. The likelihood of future dividend payments is contingent upon the company's financial performance.

 

IPO's Strengths

• Sustained organizational steadiness coupled with proficient management capabilities.
• Seamless execution of operational processes.
• Clearly delineated organisational framework.
• Established supplier connections.
• An extensive array of available products.

 

IPO Weaknesses 

• The company has a history of loan repayment defaults.
• Mr. Kaupilkumar Hasmukhbhai Shah, one of the company's promoters, has previously defaulted on credit card payments.
• The company has experienced financial losses in the past and may continue to incur losses in the future.
• The seeds business is susceptible to significant seasonality, which can impact the company's operating results.
• The company does not possess any cold storage facilities for product storage.
• A substantial portion of the company's revenue is generated from a limited customer base.
• The company faces competition from established certified seed manufacturers.
• Many of the company's products are chemically prepared and harmful to health, potentially requiring future regulatory approvals for trading.
• Insufficient awareness and knowledge among farmers contribute to their preference for naturally grown seeds over hybrid seeds.

 

 

IPO GMP Today

City Crops Agro SME IPO GMP is not yet available

 

Conclusion 

City Crops Agro Limited operates within a highly competitive sector and has incurred financial losses in the past. Furthermore, the company depends on third-party contracts for trading agricultural products. Hence, it is prudent to consider a comprehensive assessment of all relevant factors before making any investment decisions.

 

Finowings IPO Analysis

Hope you enjoyed the Finowings IPO Analysis. We tried our best to give every required detail about the company that you should know before applying to the IPO. 

You must consult your financial advisor before making any financial decisions. 

To Apply for the IPO, Click Here.

 

To Read the Prospectus of the Company Click Here to Download the DRHP.

 

 

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