Kundan Edifice Limited IPO - Review, Valuation, Date, & GMP

Kundan Edifice Limited - Complete Overview

Established in the year 2010, Kundan Edifice Limited is actively involved in the business of manufacturing, assembling, and selling light-emitting diode (LED) strip lights. 

Functioning as an Electronics Manufacturing Services (EMS) Company, it primarily operates as an original design manufacturer (ODM). The company's core activities encompass the design, development, manufacturing, and supply of products to its clientele, who subsequently market these products under their own brand names.

With more than six years of experience in the EMS sector, Kundan Edifice Limited specializes in the production of LED strip lights, an innovative form of lighting product with diverse applications spanning various industries, including real estate, railways, automobiles, and decorative lighting. The company is recognized for offering lighting solutions to some of the prominent electrical and electronic manufacturing brands in India.

Kundan Edifice Limited operates two manufacturing and assembly facilities in the state of Maharashtra, specifically in Vasai and Bhiwandi. As of August 31, 2023, the company has a workforce of over 311 employees in its manufacturing facilities, which includes both permanent employees and contract workers.

 

What does the company do?

Kundan Edifice Limited specializes in the manufacturing, assembly, and sales of light-emitting diode (LED) strip lights as a core part of its business operations.

 

 

Company Products

The company's product range comprises HV Flex, LV Flex, RGB LV Flex (Smart Lights), and an Accessories Kit.

 

IPO Overview

The Kundan Edifice Limited IPO date is scheduled from September 12th to September 15th, 2023. This IPO falls under the SME category and is anticipated to be listed on the NSE SME platform on September 26, 2023.

The company has set the IPO price at Rs.91 per share, and one lot of shares consists of 1200 shares. Kundan Edifice Limited aims to raise Rs.25.22 Crores through this IPO to meet specific objectives.

Continue reading for a comprehensive IPO review and to stay updated on upcoming IPOs, please refer to the Finowings IPO section.

 

Kundan Edifice Limited IPO timetable (Tentative)

Events	Date
IPO Opening Date	12 September 2023
IPO Closing Date	15 September 2023
IPO Allotment Date	21 September 2023
Refund initiation	22 September 2023
IPO Listing Date	26 September 2023

 

Kundan Edifice Limited IPO Details

IPO Opening & Closing Date	12 September to 15 September 2023
Face value	Rs.10 per share
Issue Price	Rs. 91 per share
Lot Size	1200 Shares
Price of 1 lot	Rs.109,200
Issue Size	2,772,000 Shares (aggregating up to Rs. 25.22 Cr)
Offer for sale	NA
Fresh issue	2,772,000 Shares (aggregating up to Rs. 25.22 Cr)
Listing at	NSE SME
Issue Type	Fixed Price Issue IPO
Registrar	Cameo Corporate Services Limited

 

Kundan Edifice Limited IPO Lot Details 

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

 

Kundan Edifice Limited IPO Reservation

Other Investors Share Portion	50%
Retail Investors Share Portion	50%

 

Company Financial

Amount in Lakhs

Period	FY - 21	FY - 22	FY - 23
Total Assets	1185.44	1928.14	2965.84
Total Revenue	1522.43	3250.60	6046.36
PAT	77.22	167.82	513.09
Net Worth	129.90	297.72	810.81
Reserve & Surplus	-170.10	-2.28	60.81
Total Borrowings	728.65	905.03	1450.61

 

Revenue generated from top customers:

Amount in Lakhs

Particulars	FY 23	FY 22	FY 21
Top 1 customer	1,315.29	878.70	243.13
Top 5 customer	3,953.97	2,141.19	872.77
Top 10 customer	5,355.16	2,925.14	1,203.65

 

Split of the revenue from operations in ODM businesses and others

Amount in Lakhs

Particulars	FY 23	FY 22	FY 21
120LED- HV Flex	1386.02	62.68	14.74
60LED-HV Flex	2295.30	1086.19	91.61
60LED LV Flex	1263.82	1415.10	1051.39
120LED LV Flex	232.64	214.30	133.82
180LED LV Flex	160.50	166.95	181.15
240LED LV Flex	249.53	38.46	7.31
RGB LV Flex (Smart Lights	20.90	76.45	8.87
Accessories Kit and others	413.23	187.09	24.36
Total	6021.93	3247.21	1513.66

 

Revenue bifurcation of the Company with respect to OEM & ODM

Amount in Lakhs

Particulars	FY 23	FY 22	FY 21
OEM Revenue	147.98	8.78	27.52
ODM Revenue	5898.38	3251.72	1494.91
Total Revenue	6046.36	3260.50	1522.43
OEM%	2.45	0.27	1.81
QOM%	97.55	99.73	98.19

 

Objective of the Issue

The funds raised will be allocated to achieve the following objectives:

• Addressing increased working capital needs.
• Supporting general corporate purposes.

 

Promoters and Management of Kundan Edifice Limited

Divyansh Mukesh Gupta and Vijaya Mukesh Gupta are the Promoters of the Company.

Pre-issue Promoter Shareholding	99.00%
Post-issue Promoter Shareholding	72.28%

 

Peer Comparison

According to Kundan Edifice Limited DRHP, there are no publicly listed companies that are exclusively engaged in the manufacturing of LED strip lights.

 

IPO's Valuations

To assess the IPO valuation, we can utilize the data provided by the company. The IPO price is Rs. 91 per share, and the EPS is Rs. 6.84. Based on the issue price, the company's P/E ratio is approximately 13.30.

 

Dividend Policy

The company has not paid any dividends in the past, and any potential future dividend payments will be contingent on the financial performance of the company. 

 

IPO's Strengths 

• Established, enduring partnerships with prominent industry clients.
• Emphasis on robust research and development efforts.
• Seasoned Promoter Directors possessing in-depth expertise in the field.
• A well-established manufacturing facility strategically designed to cater to a wide array of product offerings.
• Demonstrated and steady financial performance.

 

IPO Weaknesses

• The Company and its affiliated companies are involved in ongoing litigation and are subject to various claims.
• The company relies significantly on specific key customers for a substantial portion of its revenue.
• The markets in which the company's customers operate are marked by rapidly changing consumer preferences.
• During the twelve months leading up to the Prospectus filing date, the Company issued Equity Shares at prices that may have been lower than the Issue Price.
• There have been previous instances of regulatory non-compliance, delays, or errors.
• The company requires various approvals and licenses as part of its regular business operations.
• Some Promoter Group Companies have experienced losses in the past and may continue to do so in the future.
• The Company has experienced negative cash flows from its operating and investing activities in prior years.
• The company operates within a competitive business landscape.

 

 

IPO GMP 

Latest GMP of Kundan Edifice SME IPO is Rs. 40.

 

Conclusion

Kundan Edifice operates in the EMS and LED sectors, boasting significant experience, and has demonstrated strong financial performance. Nonetheless, the notable surge in revenue during FY 23 prompts inquiries about its sustainability. Seasoned investors may consider investing in the offering after conducting a thorough analysis.

 

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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