Trom Industries Ltd IPO: Review, Valuation, Opening Date & GMP

Trom Industries Limited IPO-Complete Overview

Trom Industries Limited IPO is an SME Book Built Issue of Rs.31.37 crores by Trom Industries Limited that was established in 2011, is a solar EPC (Engineering, Procurement, and Construction) company that specializes in residential solar rooftop systems, industrial solar power plants, ground-mounted solar power plants, and solar street lights.

Trom Industries has the following business segments:

Residential rooftop installations: The company creates and deploys solar systems tailored to individual homes.

Industrial installations: The company designs and develops large-scale solar power facilities for industrial applications.

Ground-mounted solar power plants: This requires the creation of ground-mounted solar collectors.

Supply and installation of solar street lighting in public and commercial sectors.

The company's product range comprises (1) solar products: solar street lights, solar freezers, off-grid solar systems, solar home lights, solar water purifiers, and solar water pumps; and (2) AC LED lights: AC LED road lights and AC LED flood lights.

The company employed 31 people as of March 1, 2024, including directors and important managerial staff.

Dear readers, we are pleased to provide details about the approaching SME IPO. The company plans to launch its IPO on July 25, 2024. Let's take a closer look at the IPO's offerings below.

 

 

Trom Industries Limited IPO Overview

Trom Industries's IPO of Rs.31.37 crore comprises a wholly Fresh Issue of 27.28 lac Shares (amounting to Rs.31.37 crores) out of which 35% is allocated to retail investors, 50% to institutional investors, 15% to non-institutional-investors.

This SME IPO will be available to investors on July 25, 2024, and conclude on July 29, 2024. The anticipated listing date for the IPO is Thursday, August 1, 2024, and will be held on the NSE and SME. The price range of each Share is Rs.100 to Rs.115.

If you want to apply for the IPO, Click Here to Open a Demat Account.

 

Company Financial

The company's revenue increased by 125.98%, while profit after tax (PAT) increased by 1885.2% during the financial years ending March 31, 2024, and March 31, 2023. 

Below is the synopsis of the company's financial data for the financial year ending March 31, 2024.

• The total revenue of the company is Rs.643.92 lac.

• The net worth of the company is Rs.354.80 lac.

• The company's EBITDA is Rs.101.66 lac.

• The total assets of the company are Rs.560.79 lac.
  
  

(Amount in Lac)

 

Revenue Bifurcation

Below is the revenue breakdown for various activities:

(Amount in Lac)

Geography-wise Revenue Breakdown For The Last Three Fiscals.

The Objective Of The Issue

The company desires to use the Net Proceeds from the Issue to fulfill its following goals:

• Funding for establishing a solar power plant.

• Meeting working capital requirements.

• Corporate Purposes.

 

Peers Of Trom Industries Limited

(Figures as of Fiscal 2024)

Company Name	Face Value (Rs.)	EPS (Rs.)	P/E (x)
Alpex Solar Limited	10	14.12	63.86
Australian Premium Solar India Limited	10	3.12	171.15
Solex Energy Limited	10	10.92	137.79

 

 

Evaluation

The price of this IPO is Rs.100 to Rs.115 for each Share.

Evaluation Of P/E Ratio

Considering the Fiscal 2024, with EPS of Rs.8.88 from the last year, the resulting P/E ratio is 12.95x.

Considering the weighted EPS of Rs.5.06 for the last three years, the P/E ratio is 22.72x.

Comparative Analysis With Listed Peers

The average P/E Ratio of the industry is 124.27x.

In simple words, the P/E ratio of Trom Industries Limited-IPO (12.95x and 22.72x), compared with the industry’s average P/E of 124.27x, has an undervaluation. Hence the price of the Share seems fairly priced for the investors when considered based on the average P/E ratio of the industry.

IPO's Strengths

• Extensive Variety of Products.

• Strong relationships with consumers and suppliers.

• An accomplished management group with sector knowledge.

IPO’s Weaknesses

• The revenues are heavily reliant on its operations in the geographic region of Gujarat. Any negative developments in this region may negatively affect the company’s financial situation and performance.

• The government may start constructing solar water pumps/products and provide them at lower prices.

• As the government builds additional dams, the need for solar pumps will decrease.

• The company had negative cash flows from investment and financing activities.

• They have supplier concentration concerns as they rely on a small number of third-party suppliers for crucial raw materials and components. Supply constraints or quality issues may delay project completion and hinder its ability to offer profitable services to customers, negatively impacting its business, financial condition, and operations.

• Disruptions to logistics and transportation services may hinder supplier deliveries, raise transportation costs, and negatively impact its operations.

 

IPO GMP Today

Trom Industries Limited IPO’s latest GMP is Rs.155.

 

 

Trom Industries Limited IPO Timetable (Tentative)

The IPO is scheduled from July 25 to July 29, 2024, with allotment on July 30, refund initiation on July 31, and listing on August 1, 2024.

 

Trom Industries Limited IPO Details 

The IPO with a Face Value of Rs.10 per Share is set to start on July 25, close on 29 July, and offer a total issue size of 2,727,600 Shares (aggregating up to Rs.31.37 Cr)  comprising a whole fresh issue size of 2,727,600 Shares (totaling up to Rs.31.37 Cr).

Trom Industries Limited IPO Lot Details 

The IPO allows retail investors to invest in a minimum and maximum of 1 Lot (1200 Shares) amounting to Rs.138000 and in multiples thereof, while for HNI investors, the minimum Lot is 2 (2400 Shares) amounting to Rs.276000.

Minimum Lot Investment (Retail)	1 Lot
Maximum Lot Investment (Retail)	1 Lot
HNI (Min)	2 Lots

 

Trom Industries Limited IPO Reservation

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

 

Promoters And Management Of Trom Industries Limited IPO

• Jignesh Patel

• Pankaj Pawar