The financial performance of the Issuer is showing a declining trend since the last two fiscals. The total revenues of Shriram Properties reduced by 21% for FY21 against the revenues of FY20. In FY20, revenues declined by 13% when compared to FY19. The Issuer has been posting net losses after tax for Q1FY22 and for last two fiscals. However, the company has posted positive EBITDA margins as can be seen in the table.
Debt equity ratio is at a higher side of 1.41x as at the end of H1FY22. Return on net worth is -7.81%, -8.14%, -9.55%, and 4.98% for 6MFY22, FY21, FY20 and FY19 respectively.
|Cash generated from operations||54.99||147.59||129.12||-179.23|
The P/E of the Issuer is not ascertainable due to the negative EPS. P/BV is 2.29 with NAV of Rs 51.53 as at the end of H1FY22 calculated at the upper price band of Rs 118 per share. Sobha Ltd, Sunteck Realty, Brigade Enterprises, Prestige Estates, Godrej properties and Oberoi Realty are the peers of the Issuer as per the RHP.
|Particulars||Sobha Ltd.||Prestige Estates||Brigade Ent.||Godrej Properties||Oberoi Realty||Sunteck Realty||Shriram|
|Face Value per share||10||10||10||5||10||1||10|
|Total Income for FY21 (INR Crores)||2190.4||7501.8||2010.4||1333.09||2090.59||630.84||501.31|
|EPS (yr ended FY21)||6.57||36.32||-2.24||-7.48||20.33||2.98||-4.6|
|NAV per share||255.97||166.52||111.32||299.32||257.68||19.75||56.44|
|Return on net worth||2.59%||23.31%||NA||NA||7.91%||1.35%||NA|
Shriram Properties Limited IPO opens on 8th Dec with an Issue size of Rs 600 crore (fresh issue of Rs 250 crore). The Issue has a price band of Rs 113-118 per share, has a 10% retail quota and the minimum application amount is Rs 14,750. The issue closes on 10th Dec and is expected to list on 20th Dec 2021. The proceeds would be used towards repayment of certain borrowings (Rs 200 crore).
The real estate sector has been affected by the pandemic and the lock-down impacted both residential and commercial sectors. Though the residential market is on a recovery path but the situations are still challenging. The Issuer has a weak financial profile with losses after tax for the last two fiscals and H1FY22. Also the Issuer’s operations are region specific and concentrated in South India. Considering these factors one may Avoid this IPO.
Review By CA Priyanka Choudhary on 3rd Dec 2021
About CA Priyanka Choudhary
Priyanka Choudhary Jain is a Chartered Accountant and an experienced credit analyst. She has worked with CRISIL as Senior Credit Analyst on ratings assignments including business and financial analysis in Corporates as well as the Public Finance Sector.
Email: [email protected]
DISCLAIMER: No financial information whatsoever published anywhere here should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is purely for educational and information purposes only and under no circumstances should be used for making investment decisions. Readers must consult a qualified financial advisor prior to making any actual investment decisions, based on information published here. Any reader taking decisions based on any information published here does so entirely at own risk. Investors should bear in mind that any investment in stock markets are subject to unpredictable market related risks. Above information is based on RHP and other documents available as of date coupled with market perception. Author has no plans to invest in this offer.
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