Shanti Overseas (India) Limited was established in 2011. It is primarily engaged in manufacturing and trading of Agri commodities. Shanti Overseas (India) Limited is coming up with an IPO. Shanti Overseas IPO review will delve into the issue details and find how good it is for investment.
- Issue opens on – 21 July 2017
- Issue closes on – 26 July 2017
- Issue type – Fixed price IPO
- Issue price – Rs 50 per equity share
- Face value – Rs 10 per equity share
- Issue size – 2,004,000 nos. of equity shares aggregating up to Rs 10.02 crores
- Lot size – 3000 shares and multiples thereof
- Retail allocation – 50%
- Listing Exchange – NSE SME
- Listing objective – a)To meet issue expenses, b) to invest in Shaan Agro Oils & Extractions Pvt. Ltd., c) to purchase equipment for upcoming soybean processing plant and d) to meet general corporate expenses
About the company – Shanti Overseas (India) Limited manufactures and trades in the following items.
- Soya de-oiled cakes
- Soya Lecithin
- Soya crude oil
- Degummed oil
- Soybeans and Soya meals
- Cracked corn
- Yellow peas
Agri commodities are processed in the processing plant at Palda, M.P. and Soybean products are manufactured in the plant of Sonvai, M.P. The company is in advance process of setting up another plant at Dhannad, M.P. The company also has two wholly owned subsidiaries. These companies are also running well. They are
Shanti Overseas enjoy a sizeable chunk of profit from its overseas business. They regularly export their product in countries like USA, Canada, Turkey, Dubai, Pakistan Sri Lanka, Spain etc. The company also has two wholly owned subsidiaries. These companies are also running well. They are
- Biograin Proteinex Pvt. Ltd. (2016 – yr of incorp.)
- Shaan Agro Oils and Extractions Pvt. Ltd. (2017 – yr. of incorp.)
Company Financials –
Shanti Overseas IPO review finds a few pros and cons in this issue.
Pros – The area of business the company is in always have high demand. Business in Agri commodities is a flourishing business. The company is also showing steady growth in PAT. And above all, it earns good profit from the overseas business by selling their own products which have established presences in overseas Agri commodities market.
Cons – The company is yet to start its own plant. In the past, the company has seen negative cash flows. It has a moderate amount of secured and unsecured borrowings. Agri commodity business orients around natural factors that promote growth of Agri commodities. Thus there is always an underlying risk in future projection.
Conclusion – Shanti Overseas IPO review finds that if the company reduces debt from net cash flow received from this issue and owns own plant – which they are supposed to do, we may see good growth in the company. Expert foreign exchange hedging and sizeable inventory will take profit further. The foreign exchange hedging is already making profit for the company. Shanti Overseas IPO review finds the IPO may give good returns for the medium and long term investors.
Disclaimer – Views expressed in this review is an educated guess made on the basis of available data from open source expressed for the purpose of knowledge sharing. By no means, it should be taken as an investment advice or recommendation. Investor/ trader should invest money at their own risk.
Partha, an engineer by education, is theoratically actively following the stock and commodity markets since 1990. He is an active trader since 2003. He has received formal education in future and options and quantum analysis. He is presently working on research oriented projects using Python and data analytics.