OBSC Perfection Limited IPO: Review, Valuation, Date & GMP

OBSC Perfection IPO-Complete Overview

OBSC Perfection IPO under the SME IPO category is a book-built issue of Rs.66.02 crore by OBSC Perfection Pvt Ltd. The company was founded in 2017 and is a maker of precision metal components. It provides a broad range of high-quality manufactured parts for different end-user sectors and regions through its precision engineering products.

Precision metal components manufactured by OBSC Perfection include but are not limited to, cut blanks, gear shifters, pinions, drive shafts, torsion bars, piston rods, rack bar semi-finished products, sensor boss, sleeves, push plates, hubs, housings; brass and aluminum, fork bolt, fasteners, connectors, ball pin, ball pin housing, flanges, male-female rings, and dozing adapter. 

It sells its products to defense, marine, and telecom infrastructure sectors.

This OBSC IPO will start on 22 October 2024, and its ‘initial public offering’ will end on 24 October 2024.

 

OBSC Perfection IPO Overview

The Rs.66.02 crore new SME IPO comprises a wholly fresh issue of 66.02 lac Shares. 

This upcoming IPO date is from October 22 to October 24, 2024. The OBSC Perfection Limited IPO price is Rs.95 to Rs.100 for each Share. 

The expected IPO listing date is, 29 October 2024, and listing at NSE and SME.

 

OBSC Perfection IPO listing price

The listing price will be declared on the listing day of the IPO.

 

To open a demat account and apply for the IPO, Click Here.

Company Financial

The company’s revenue grew by 20% and PAT increased by 167% during FYs ending 31 March 2024 and 31 March 2023.

(Amount in Lac)

 

Revenue Bifurcation

The revenue bifurcation for various activities is shown below:

(Amount in lac)

 

Segment-wise Revenue Breakdown  

(Amount in lac)

 

Sales-wise Revenue Breakdown  

(Amount in lac)

 

Geography-wise Revenue Breakdown  

(Amount in lac)

 

 

The Objective of the Issue

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

• Financing the necessary capital expenditures for the acquisition of machinery for the current production plant ("Unit III") located at 126 Mappedu Village, Sriperumbudhur Taluka-Mappedu, Thiruvallur, Tamil Nadu, India. (‘Planned Growth at Unit III’).

• Financing the necessary capital expenditures for the acquisition of machinery for the current manufacturing plant (also known as "Unit IV") located at Gat no. 417, Nighoje, close to the Hotel Maha Laxmi and Mess, Nighoje, Chakan, Taluka-Khed, Pune-410501, Maharashtra, India. "Proposed Unit IV Expansion".

• To fulfill increasing needs for working capital.

• General corporate purposes.

 

Peers of OBSC Perfection Ltd.

 

Note:-

The basic EPS of the peers is for the financial year ended on 31 March 2024.

 

Evaluation

The IPO price is Rs.95 to Rs.100 for each Share.

Evaluation of P/E Ratio

Considering the FY ended 31 Mar 2024 with an EPS of Rs.6.84 from the last year, the resulting P/E ratio is 14.62x.

Considering the weighted EPS of Rs.4.61 for the last three years, the P/E ratio is 21.7x.

Comparative Analysis With Listed Peers

The average P/E Ratio of the industry is 22.18x.

 

In simple words, the P/E ratio of this IPO (14.62x), compared with the industry’s average P/E of 22.18x, has an undervaluation (on a P/E ratio basis only). Hence the price of the Share seems fully priced for the investors when considered based on the average P/E ratio of the industry.

IPO's Strengths

• Manufacturing facilities are located in two of India's most well-known auto centers.

• The strategic advantage derived from a streamlined supply chain with a nearby source of raw materials.

• Qualified workforce and a seasoned management team.

• Reliable financial results.
  
  

IPO’s Weaknesses

• Comparatively young business (founded in 2017).

• A heavy reliance on the auto industry.

• Intense competition in the precision engineering space.

• Financial contractions that affect the auto industry.

• Price fluctuations for basic materials.
  
  

OBSC Perfection IPO GMP

The IPO GMP today is Rs.0 as of 21 October 2024. With a price of Rs.100 per Share, the estimated IPO listing price is Rs.100 when writing this information.

IPO Timetable (Tentative)

The OBSC Perfection Limited IPO date is from October 22 to October 24, 2024, with allotment on October 25, refund initiation on October 28, and listing on October 29, 2024.

 

OBSC Perfection IPO Details 

The IPO with a Face Value of Rs.10 per share offers a total issue size of 6,60,2400 Shares (Rs.66.02 Cr).

 

OBSC Perfection IPO Lot Details 

The IPO allows retail investors to invest in a minimum and maximum of 1 Lot (1200 Shares) amounting to Rs.1,20,000 and in multiples thereof, while for HNI investors, the minimum Lot is 2 (2400 Shares) amounting to Rs.2,40,000.

 

OBSC Perfection IPO Reservation (% of Net Issue)

 

Promoters And Management of OBSC Perfection Ltd.

• Saksham Leekha

• Ashwani Leekha

• Sanjeev Verma

• Rajni Verma

• Asha Narang

• Sandeep Narang

• Richard Blum

• Adrianne Blum

• Pascal Blum

• Simon Blum

• Omega Bright Steel and Components Private Limited

• Omega Bright Steel Private Limited

• ESS U Enterprises Private Limited

• Bluwat AG.
  
  

 

IPO Lead Managers

• Unistone Capital Pvt Ltd.
  
  

Dividend Policy

The company has not paid dividends since incorporation.

 

Conclusion

The OBSC Perfection IPO represents an entry ticket to the precision metal components market. Strong revenue growth and a P/E ratio presently in line with its peer group make it fairly priced. However, the business is by no means dependent on the car industry. It has serious challenges. Still, this is an interesting option for those willing to take on some risk.

 

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.

Disclaimer: 

This is NOT any buy or sell recommendation. The content is purely for educational and information purposes only. We do NOT encourage/advise/suggest our active readers to be involved in any kind of buying or selling securities/trading activities. Always consult your eligible financial advisor for investment-related decisions. The author does NOT through this blog intend to involve readers in investing/trading. 

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