Silkflex Polymers India Ltd IPO: Review, Valuation, Date & GMP

Silkflex Polymers India Limited IPO  - Complete Overview

Established in 2016, Silkflex Polymers India Limited specializes in the trading of textile printing inks and water-based wood coating polymers under the renowned Malaysian brand, "Silkflex," manufactured by Silkflex Polymers SDN BHD. 

Silkflex products hold prestigious certifications such as ZDHC Confidence Level 3, Eco-Passport certificate from Oeko-Tex®, and GOTS-version 7 certificate, attesting to their quality and sustainability.

The company offers a diverse range of products, including 108 textile printing ink variants and 51 wood coating polymer options. Headquartered in West Bengal, the company extends its reach through five branch offices located in Gujarat, Maharashtra, Tamil Nadu, Rajasthan, and Punjab.

Through a Technology Transfer Agreement (TTA) dated July 25, 2023, Silkflex Malaysia has authorized the company to manufacture its products in India. This agreement grants the company full rights and access to technology, including key products like Silkbond 35 and binders for table glue products.

Silkflex Polymers India Limited IPO Overview:

Silkflex Polymers India Limited IPO date is slated to be open for subscription from May 7, 2024, to May 10, 2024. This NSE SME IPO follows a Fixed Price Issue IPO.

Silkflex Polymers India Limited IPO price is fixed at Rs.52 per share. 

The total issue size of this IPO amounts to Rs.18.11 Cr. The company has allocated shares 50% to retail investors and 50% other investors.

 

 

Company Financial

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

Amount in Lakhs

Period	31 Dec 2023	31 Mar 2023	31 Mar 2022
Total Assets	3,446.35	2,374.73	1,968.81
Total Revenue	3,381.55	3,442.25	2,804.52
PAT	256.66	78.59	68.59
Net worth	1,073.28	816.62	738.03
Reserve & Surplus	260.78	566.62	488.03
Total Borrowings	1,716.18	1,208.31	994.50

Category-wise revenue break up

(Amount in Lakhs)

Particulars	31 Dec 2023	31 Mar 2023	31 Mar 2022
Textile printing ink products	3180.11	3,261.59	2,617.11
Wood coating products	168.31	159.73	165.36
Total	3348.42	3,421.32	2,782.47

State-wise Revenue Break UP

(Amount in Lakhs)

State	31 Dec 2023	31 Mar 2023	31 Mar 2022
West Bengal	474.09	584.79	456.61
Tamil Nadu	1756.69	2,033.20	1,512.50
Punjab	398.19	661.75	638.62
Rajasthan	168.19	140.15	157.69
Gujarat	551.26	1.44	17.06
Total	3348.42	3,421.32	2,782.47

Industry-wise Revenue Break up

(Amount in Lakhs)

Industry	31 Dec 2023	31 Mar 2023	31 Mar 2022
Textile Industries	3180.11	3,261.59	2,617.11
Wood Industries	168.31	159.73	165.36
Total	3348.42	3,421.32	2,782.47

Revenue bifurcation on the basis of B2B or B2C model

(Amount in Lakhs)

Particulars	31 Dec 2023	31 Mar 2023	31 Mar 2022
B2B model	2400.71	3,261.59	2,617.11
B2C model	947.71	159.73	165.36
Total	3348.42	3,421.32	2,782.47

 

The Objective of the Issue

The Company proposes to utilize the Net Proceeds for the following objectives:

1. Acquisition of land.

2. Funding of capital expenditure requirements of our Company towards purchase of Plant and Machineries.

3. Funding Working Capital Requirements of our Company.

4. General corporate purposes.

 

Peers of Silkflex Polymers India Limited IPO

Name of the Company	Face Value (Rs)	EPS (Rs)	P/E Ratio
Silkflex Polymers (India) Limited	10	0.97	53.76
BASF India Limited	10	93.10	40.12
Heubach Colorants India Limited	10	8.31	48.88
Berger Paints India Limited	1	8.86	57.44

 

 

Evaluation

The IPO is price fixed at Rs.52 per share.

Evaluation of P/E Ratio

• Considering the FY23 EPS of Rs 0.97 from last year, the resulting P/E ratio is 53.61x.

• Taking into account the weighted EPS of Rs 0.88 for the last three years, the P/E ratio amounts to 59.09x.

Comparative Analysis with Listed Peers

• The industry's average P/E is 50.05x.

As a result, the IPO price range, with a P/E ratio ranging from 53.61x to 59.09x, seems fully priced to the industry average of 50.05x.

IPO's Strengths 

• Silkflex products boast ZDHC Confidence Level 3 certification, ensuring top-tier sustainability standards.

• The company offers wide range of products.

• The company benefit from its strategic location.

• The company has longstanding and trusted relationships with its clients.

• The company has seasoned promoters and directors to drive innovation and progress.

• The company applies strong marketing strategies.
  
  

IPO's Weaknesses 

• The Promoter and Directors of the company face ongoing criminal litigations, which may impact operations and reputation.

• Potential delays or defaults in client payments could lead to decreased profitability for the company.

• Trading activities are susceptible to fluctuations in the prices of traded goods, posing a risk to the company's financial stability.

• The company had faced negative cash flows in previous years 

• Compliance with foreign exchange control regulations exposes the company to currency fluctuation risks.

• Operating within a competitive and fragmented sector presents challenges and potential obstacles for the company's growth and market position.

 

 

IPO GMP Today

The latest GMP of Silkflex Polymers India Limited is Rs.12.

Silkflex Polymers India Limited IPO timetable (Tentative)

Silkflex Polymers India Limited IPO is scheduled from May 7 to May 10, 2024, with allotment on May 13, refund initiation on May 14, and listing on May 15, 2024.

Events	Date
IPO Opening Date	May 7, 2024
IPO Closing Date	May 10, 2024
IPO Allotment Date	May 13, 2024
Refund initiation	May 14, 2024
IPO Listing Date	May 15, 2024

Silkflex Polymers India Limited IPO Details 

Silkflex Polymers India Limited IPO, with a face value of Rs.10 per share, opens on May 7 and closes on May 10, 2024, offering 3,482,000 shares at Rs.52 per share, with a lot size of 2000 shares, aiming to raise Rs.18.11 Cr, and will be listed on NSE SME.

IPO opening & closing date	May 7, 2024 to May 10, 2024
Face value	Rs. 10 per share
Issue Price	Rs. 52 per share
Lot Size	2000 shares
Price of 1 lot	Rs. 104,000
Issue Size	3,482,000 shares (aggregating up to ₹18.11 Cr)
Fresh issue	3,482,000 shares (aggregating up to ₹18.11 Cr)
Listing at	NSE SME
Issue Type	Fixed Price Issue IPO
Registrar	Bigshare Services Pvt Ltd

Silkflex Polymers India Limited IPO Lot Details 

For Silkflex Polymers India Limited IPO, the retail investor minimum and maximum lot investments are both 1 lot (2000 shares) at Rs.104,000 while for HNI investors, the minimum investment is 2 lots (4000 shares) at Rs.208,000.

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

Silkflex Polymers India Limited IPO Reservation

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

 

Promoters and Management of Silkflex Polymers India Limited

• Mr Tushar Lalit Kumar Sanghavi

• Ms Urmi Raj Mehta

• M/s. Tushar Lalitkumar Sanghavi HUF 

• M/s. Lalitbhai H Sanghvi HUF.

Pre-issue Promoter shareholding	99.84%
Post-issue Promoter shareholding	69.89%

 

Silkflex Polymers India Limited IPO Lead Managers:

• Shreni Shares Limited 
  
  

Dividend Policy

There are no dividends declared by the company on equity shares since incorporation.

Conclusion

The company specializes in trading Malaysian textile printing inks and water-based wood coating polymer products within India, maintaining a steady revenue stream. However, the sudden spike in the company's profits during FY23 has sparked concerns. Seasoned investors are advised to conduct thorough analysis before considering investment in the upcoming IPO, aiming to maximize potential gains.

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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