Do read Intraday expectation comment by Sonam Sinha.
GMP Report : On 05-04-2017 at 10.00 am GMP Rs.155 – 157
Shankara Building Products Limited finalized allocation of 2,250,000 Equity Shares in aggregate, to Anchor Investors at Rs. 460/- per Equity Share (upper end of the Price Band) aggregating to Rs. 103.5 crore to 16 anchor investors.
Subscription Commentary : at 5.30 pm on D1 51% subscribed
As on Date & Time ……………………QIB …….. NII……… RII ………. Total
Shares Offered ……………………..1522232 1131671 2640564 5294467
Day 1 – Mar 22, 2017 05:00 pm ..0.0000 .. 0.0919 …. 0.9855…. 0.5081
Day 2 – Mar 23, 2017 05:00 pm ..0.9600 .. 0.4949 …. 4.3550…. 2.4916
Day 3 – Mar 24, 2017 05:00 pm 51.6271 .. 90.6807 …. 15.3466…. 41.8811
Issue Opens on 22 March 2017
Issue closes on 24 March 2017:
Issue Type: Book Built Issue IPO
Issue Size:Fresh Issue of Rs. 45 crores and Offer for sale of 816252 shares by the Promoter and 5705488 shares by selling shareholders.
Face Value: Rs 10 Per Equity Share
Price Band : Rs.440 – Rs.460 Per Equity Share
Minimum Order Quantity:32 shares
Listing proposed at: BSE, NSE
21st March – Anchor Investors
22nd March – Offer Opens
24th March – Offer Closes
28th March – Bank Holiday for Gudi Padwa
30th March – Finalisation of Basis of Allotment
31st March – Unblocking of ASBA
03rd April – Credit to Demat Accounts
04th April – Market Holiday for Ram Navami
05th April – Listing on NSE & BSE
Main Objects of the Issue:
Repayment or pre-payment of loans of the Company and VPSPL
The promoter :
Sukumar Srinivas.The Promoter, Sukumar Srinivas is an alumnus of the Indian Institute of Management,Ahmedabad, and a first generation entrepreneur
About the Company:
The company is one of the leading organised retailers of home improvement and building products in India based on number of stores, operating under the trade name Shankara BuildPro (Source: CRISIL Report). As on August 31, 2016, it operated 98 Shankara BuildPro stores spread across 10 states in India. As on September 24, 2016, it operated 100 Shankara BuildPro stores spread across 10 states in India. It caters to a large customer base across various end-user segments in urban and semi-urban markets through its multi-channel sales approach, processing facilities, supply chain and logistics capabilities.
It serves home owners, professional customers (such as architects and contractors), and small enterprises, through retail stores. Additionally, in the semi urban markets, it also caters to specific agricultural requirements of individual customers and small enterprises. Under retail operations, it offers a comprehensive range of products at its stores, including structural steel, cement, TMT bars, hollow blocks, pipes and tubes, roofing solutions, welding accessories, primers, solar heaters, plumbing, tiles, sanitary ware, water tanks, plywood, kitchen sinks, lighting and other allied products. The company carries reputed
third party brands such as Sintex, Uttam Galva, Uttam Value, Futura, APL Apollo and Alstone and own brands such as CenturyRoof, Ganga and Loha at the retail stores. In Fiscal 2016, its revenue from retail sales was ‘8,077.56 million which contributed 39.68% of its total sales as of Fiscal 2016 representing a CAGR of 28.67%, as compared to its revenue from
retail sales in Fiscal 2012, being ‘2,947.20 million. The balance revenue during this period comprised of enterprise sales, contributing 32.20% and channel sales contributing 28.13% of the total revenue.
It has backward integrated through its processing facilities in select building products like steel pipes, colour coated roofing sheets, bright rods, galvanized strips and cold rolled strips. Its sells these products under its own brands like CenturyRoof, Ganga, Loha, Taurus and Prince Galva through the retail and branch network. Its own processing facilities
help to offer customised solutions and meet quality standards as well as timely delivery requirements of its customers. It has 11 processing facilities having a total installed capacity of 2,86,200 MTPA operating at an average capacity utilization of 93.75% in Fiscal 2016.
To cater to its customers, it has a robust logistics network which, as of August 31, 2016, consisted of 58 warehouses aggregating 0.58 million sq. ft., and a fleet of 47 owned trucks to augment last mile delivery. A large part of its warehousing backbone is owned which ensures stability of operations. It also helps in catering to the requirements of its retail outlets. With an aim to offer a comprehensive range of products, it has expanded its product offerings and as of August 31, 2016, product portfolio comprised of 17,842 SKUs.
Net worth was Rs2,909.21 million as on Fiscal 2016,
Its net asset value per Equity Share was Rs 133.02 as at March 31, 2016,
EPS for the year ended on March 31, 2016 is Rs. 19.04
Total revenue from operations, as per Restated Financial Statements, for Fiscals 2014, 2015 and 2016 were Rs19,271.04 million, Rs19,788.16 million and Rs 20,359.20 million, respectively and the net profit after tax, for Fiscals 2014,2015 and 2016 were Rs 287.07 million, Rs 225.81 million and Rs 416.42 million. The company is ranked 200th among India’s largest
unlisted companies in terms of revenue, by Business Standard in the year 2015. Also, it was awarded the ‘Emerging India Award’ in the “Retail Trade” category, organized by ICICI Bank, CRISIL and CNBC TV 18 in the year 2005.
About the Industry:
India ranked as the 7th largest economy in the world with a GDP of US$ 2,073,543 million for 2015. It is expected that the real GDP growth will increase up to 7.9% in Fiscal 2017 from 7.6% in Fiscal 2016. Domestic consumption continued to pick up slowly, as reflected in the trend in private final consumption expenditure (“PFCE”). At current prices, PFCE is estimated at ‘81.12 trillion in Fiscal 2016 as against ‘ 71.93 trillion in 2015. In terms of GDP, the rates of PFCE at current prices during Fiscal 2016 is estimated at 59.8%, as against the corresponding rate of 57.6% in Fiscal 2015.
The current size of the real estate industry (inclusive of residential, commercial, retail, hospitality and educational projects) in India is estimated in the range of ‘8.5 – 9.0 trillion (2015-16). The housing real estate industry accounted for about 80% of the total real estate industry at about ‘7-7.5 trillion, the balance being contributed by commercial, retail, hospitality and educational projects. Within the housing industry, the share of building materials is estimated at approximately 45%, which translates to ‘3.2-3.4 trillion in value terms.
Housing demand is primarily a function of population growth. Between 2011 and 2021, India’s population is projected to increase approximately 10%-12% to 1.3-1.4 billion, which will see housing demand touch 283-287 million.
India’s per capita disposable income has increased from ‘73,476 in Fiscal 2012 to
‘107,817 as of Fiscal 2016 (base year Fiscal 2012, at current prices, inclusive of other current transfers (net) from rest of the world)). Increasing disposable income increases demand for housing units as it increases the affordability. This has a cascading effect on building materials segment. Easy availability of financing options for the retail customer is expected to provide a boost to the housing segment and consequently serve as a potent demand driver for the building material segment.
1. Equirus Capital Private Limited
2. HDFC Bank Limited
3. IDFC Securities Limited
Registrar to the IPO:
Karvy Computershare Private Limited
Hyderabad – 500 034
Grey Market Trend:
On 04-04-2017 at 11.30 am GMP Rs.155 – 157
on 03-04-2017 at 19.45 am GMP Rs. 151-155,
on 31-03-2017 at 4.45 pm GMP Rs. 144-147,
on 28-03-2017 at 11 am GMP Rs. 125
on 24-03-2017 at 7 pm GMP Rs. 122-123,
on 24-03-2017 at 10.40 am GMP Rs. 133-135, Kostak Rs. 450
on 23-03-2017 at 06.00pm GMP Rs. 150-152, Kostak Rs. 425
on 23-03-2017 at 11.00am GMP Rs. 144, Kostak Rs. 425
on 22-03-2017 at 10.30am GMP Rs. 135, Kostak Rs. 400
on 21-03-2017 in the morning , all are busy in DMart squaring up
on 20-03-2017 at 10.30 pm GMP Rs. 150-152,No Kostak
on 18-03-2017 at 05.30 pm GMP Rs. 135-138,No Kostak
on 17-03-2017 at 10.00 am GMP Rs. 158-160,No Kostak
on 16-03-2017 at 10.00 noon GMP Rs. 160-162
on 15-03-2017 at 12.00 noon GMP Rs. 90