Ramdevbaba Solvent Ltd. IPO: Review, Valuation & GMP

Ramdevbaba Solvent Limited IPO  - Complete Overview

Incorporated in 2008, Ramdevbaba Solvent Limited is engaged in the manufacturing, distribution, marketing, and sale of Physically Refined Rice Bran Oil. 

The company's primary clientele includes FMCG giants such as Mother Dairy Fruit & Vegetable Private Limited, Marico Limited, and Empire Spices and Foods Ltd, to whom it supplies Rice Bran Oil. 

The company markets and sells Rice Bran Oil under its brands, namely "Tulsi" and "Sehat," leveraging a network of thirty-eight distributors who cater to various retailers across Maharashtra.

Furthermore, the company produces De-oiled Rice Bran (DORB) as a by-product during the extraction of Rice Bran Oil. This DORB is sold as cattle feed, poultry feed, and fish feed across states such as Maharashtra, Goa, Gujarat, Madhya Pradesh, Andhra Pradesh, Telangana, Karnataka, Kerala, and Tamil Nadu. 

The company operates from its two production facilities, located in Mahadula and Bramhapuri near Nagpur, Maharashtra.

 

Ramdevbaba Solvent Limited IPO Overview

Ramdevbaba Solvent Limited IPO date is slated to be open for subscription from April 15, 2024, to April 18, 2024. This NSE SME IPO follows a Book Built Issue IPO.

Ramdevbaba Solvent Limited IPO price is fixed in the range of Rs.80 to Rs.85 per share. 

The total issue size of this IPO amounts to Rs.50.27 Cr. The company has allocated shares 35% to retail investors, 50% to institutional investors and 15% to non-institutional investors.

 

 

Company Financial

Compared to the financial year ending March 31, 2023, and March 31, 2022, Ramdevbaba Solvent Limited has seen growth in total assets, net worth, and total revenue. The profit after tax and total borrowing has also increased.

(Amount in Lakhs)

Period	31 Dec 2023	31 Mar 2023	31 Mar 2022
Total Assets	20,341.24	19,062.61	13,134.86
Total Revenue	46,569.81	70,433.41	58,525.46
PAT	828.90	1,300.15	659.15
Net worth	6,857.15	4,783.25	3,483.10
Reserve & Surplus	5,235.97	4,324.52	3,024.37
Total Borrowings	9,998.78	9,922.63	6,485.67

 

Revenues break up from states and union territories

(Amount in Lakhs)

Particulars	31 Dec 2023	31 Mar 2023	31 Mar 2022
Bihar	9.66	-	-
Andhra Pradesh	12,274.56	12,273.12	9,842.44
Chandigarh	-	2.58	-
Chhattisgarh	2,048.15	5,653.97	3,163.91
Delhi	-	7.31	1.72
Gujarat	521.91	2,762.03	1,302.40
Karnataka	118.30	458.66	179.20
Kerala	817.39	-	-
Madhya Pradesh	1,466.42	3,561.22	2,138.48
Maharashtra	23,894.21	36,065.74	33,205.51
Orissa	89.39	106.76	798.76
Pondicherry	-	-	9.44
Punjab	-	709.78	2,231.40
Rajasthan	452.24	687.11	204.16
Tamil Nadu	367.31	94.03	299.84
Telangana	1,849.20	2,117.92	1,629.17
Uttar Pradesh	2,294.48	4,703.23	2,686.02
West Bengal	155.79	571.80	595.28
Total	46,359.01	69,775.26	58,287.73

 

 

Product-wise Revenues break up

(Amount in Lakhs)

Particulars	31 Dec 2023	31 Mar 2023	31 Mar 2022
Rice Bran Oil (Own Brands)	3,867.13	7,882.14	5,471.00
Rice Bran Oil (Other Brands)	15,529.73	21,816.02	23,559.38
DORB	21,104.74	26,097.18	16,340.18
Other products	5,844.87	12,174.61	9,530.73
Trading of Rice Bran	12.54	1,805.30	3,386.45
Total	46,359.01	69,775.25	58,287.47

 

The Objective of the Issue

The company plans to utilize the Net Proceeds from the Issue to fund the following objectives:

• Establishing a new manufacturing facility.

• Repaying certain outstanding borrowings, either in full or in part.

• Meeting the working capital requirements of the company.

• Addressing general corporate purposes.

Peers of Ramdevbaba Solvent Limited IPO

Name of the Company	Face Value (Rs)	EPS (Rs)	P/E Ratio
Ramdev Baba Solvent Limited	10.00	9.45	-
BCL Industries Limited	1.00	2.75	21.15
Gokul Refoils and Solvent Limited	2.00	2.44	14.39
Gujarat Ambuja Exports Limited	1.00	14.40	10.99
Kriti Nutrients Limited	1.00	4.15	22.33
Shri Venkatesh Refineries Limited	10.00	12.96	5.48

 

Evaluation

The IPO is priced within the range of Rs.80 to Rs.85 per share.

Evaluation of P/E Ratio

• Considering the FY23 EPS of Rs 9.45 from the last year, the resulting P/E ratio is 8.99x.

• Taking into account the weighted EPS of Rs 7.07 for the last three years, the P/E ratio amounts to 12.22x.

Comparative Analysis with Listed Peers

• The industry's average P/E is 14.86x.

As a result, the IPO price range, with a P/E ratio ranging from 8.99x to 12.22x, seems fully priced to the industry average of 14.86x.

 

IPO's Strengths 

• The Manufacturing Facilities are strategically located.

• Rice bran is readily available around its Manufacturing Facilities.

• The company benefits from integrated operations and economies of scale.

• The company has arrangements with FMCG companies for the supply of Rice Bran Oil.

• Quality control is a key focus for the company.

• The Promoters and senior management team of the company bring extensive experience.

IPO weaknesses 

• The company's business relies heavily on the demand for its products in Maharashtra, Andhra Pradesh, and Uttar Pradesh.

• A significant portion of the company's revenues comes from Rice Bran Oil, and any decrease in demand or production may negatively impact the business.

• Failure to successfully establish its corn de-oiling plant could severely affect the company's revenues and reputation.

• Unfavorable local weather patterns may adversely affect the company's business, operational results, and financial condition.

• There are ongoing legal proceedings involving the Company, its subsidiary, directors, and promoters.

• The company operates in a competitive market.
  
  

 

 

IPO GMP Today 

The Latest GMP of Ramdevbaba Solvent Limited is Rs.9.

 

Ramdevbaba Solvent Limited IPO timetable (Tentative)

Ramdevbaba Solvent Limited IPO is scheduled from April 15 to April 18, 2024, with allotment on April 19, refund initiation on April 22, and listing on April 23, 2024.

Events	Date
IPO Opening Date	April 15, 2024
IPO Closing Date	April 18, 2024
IPO Allotment Date	April 19, 2024
Refund initiation	April 22, 2024
IPO Listing Date	April 23, 2024

 

Ramdevbaba Solvent Limited IPO Details 

Ramdevbaba Solvent Limited IPO, with a face value of Rs.10 per share, opens on April 15 and closes on April 18, 2024, offering 5,913,600 shares at Rs.80 to Rs. 85 per share, with a lot size of 1600 shares, aiming to raise Rs.50.27 Cr, and will be listed on NSE SME.

IPO opening & closing date	April 15, 2024 to April 18, 2024
Face value	₹10 per share
Issue Price	₹80 to ₹85 per share
Lot Size	1600 Shares
Price of 1 lot	₹136,000
Issue Size	5,913,600 shares (aggregating up to ₹50.27 Cr)
Fresh issue	5,913,600 shares (aggregating up to ₹50.27 Cr)
Listing at	NSE SME
Issue Type	Book Built Issue IPO
Registrar	Bigshare Services Pvt Ltd

 

Ramdevbaba Solvent Limited IPO Lot Details 

For Ramdevbaba Solvent Limited IPO, the retail investor minimum and maximum lot investments are both 1 lot (1600 shares) at Rs.136,000 while for HNI investors, the minimum investment is 2 lots (3200 shares) at Rs.272,000.

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

 

 

 

Ramdevbaba Solvent Limited IPO Reservation

Institutional share Portion	50%
Non-institutional share Portion	15%
Retail share Portion	35%

 

Promoters and Management of Ramdevbaba Solvent Limited

• Prashant Kisanlal Bhaiya

• Nilesh Suresh Mohata

• Tushar Ramesh Mohata

Pre-issue Promoter shareholding	81.01%
Post-issue Promoter shareholding

 

Ramdevbaba Solvent Limited IPO Lead Managers

• Choice Capital Advisors Pvt Ltd 

Dividend Policy

In the past financial year, the company didn't pay any dividends, and whether dividends will be paid in the future depends on the financial performance of the company.

 

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Conclusion

The company's upcoming IPO presents a great chance for investors. With a strong customer base and good financial performance, it may present a good investment opportunity. However, investors need to know that the company operates in a competitive market. Therefore, investors should evaluate all factors before committing their funds to the issue.

 

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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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