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SMC Research has come out with its report on PG Electroplast IPO. According to the research firm on a post-issue P/E multiple of 19.26 the issue seems to be aggressively priced and fully captures the future growth potential of the company.
SMC Research Report on PG Electroplast IPO:
The company is an Electronic Manufacturing Services (EMS) provider for Original Equipment Manufacturers (OEMs) of consumer electronic products in India. It manufactures and/or assembles a comprehensive range of consumer electronic components and finished products such as colour television (CTV) sets & components, air conditioners (ACs) sub-assemblies, DVD players, water purifiers and Compact Fluorescent Lamps (CFL) for third parties. As backward integration, it also does plastic injection moulding and manufactures Printed Circuit Boards (PCB) assemblies for CTVs, DVD players and CFL. Some of its clients include leading brands in the electronic products market. The company has four operational manufacturing facilities located at Greater Noida in Uttar Pradesh (Unit I and Unit III), at Roorkee in Uttrakhand (Unit II) and at Ahmednagar in Maharashtra (Unit IV).
Valuation: Considering the P/E valuation on the upper end of the price band of `210, the stock is priced at pre-issue P/E of 12.52x on its FY11 EPS of `16.78. Post issue, the stock discounts its FY11 earnings per share of `10.90 by 19.26x. Looking on to the P/B ratio at ` 210, the stock is priced at P/B ratio of 5.13x on the pre-issue book value of `40.92 and on the post issue book value of `100.10, the P/B comes out to 2.10x. On the lower end of the price band of `190, the stock is priced at pre-issue P/E of 11.33x on its FY11 EPS of `16.78. Post issue, the stock discounts its FY11 earnings per share of `10.90 by 17.42x. Looking on to P/B ratio at `190, the stock is priced at P/B ratio of 4.64x on the pre-issue book value of `40.92 and on the post-issue book value of `100.10, the P/B comes out to 1.90x.
Outlook: The company is present in a fast growing but highly competitive industry. The company operates on very thin margins and is dependent upon a few large customers and a single product category for a substantial portion of its total income. On a post-issue P/E multiple of 19.26 the issue seems to be aggressively priced and fully captures the future growth potential of the company.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
SMC Research has come out with its report on PG Electroplast IPO. According to the research firm on a post-issue P/E multiple of 19.26 the issue seems to be aggressively priced and fully captures the future growth potential of the company.
SMC Research Report on PG Electroplast IPO:
The company is an Electronic Manufacturing Services (EMS) provider for Original Equipment Manufacturers (OEMs) of consumer electronic products in India. It manufactures and/or assembles a comprehensive range of consumer electronic components and finished products such as colour television (CTV) sets & components, air conditioners (ACs) sub-assemblies, DVD players, water purifiers and Compact Fluorescent Lamps (CFL) for third parties. As backward integration, it also does plastic injection moulding and manufactures Printed Circuit Boards (PCB) assemblies for CTVs, DVD players and CFL. Some of its clients include leading brands in the electronic products market. The company has four operational manufacturing facilities located at Greater Noida in Uttar Pradesh (Unit I and Unit III), at Roorkee in Uttrakhand (Unit II) and at Ahmednagar in Maharashtra (Unit IV).
Valuation: Considering the P/E valuation on the upper end of the price band of `210, the stock is priced at pre-issue P/E of 12.52x on its FY11 EPS of `16.78. Post issue, the stock discounts its FY11 earnings per share of `10.90 by 19.26x. Looking on to the P/B ratio at ` 210, the stock is priced at P/B ratio of 5.13x on the pre-issue book value of `40.92 and on the post issue book value of `100.10, the P/B comes out to 2.10x. On the lower end of the price band of `190, the stock is priced at pre-issue P/E of 11.33x on its FY11 EPS of `16.78. Post issue, the stock discounts its FY11 earnings per share of `10.90 by 17.42x. Looking on to P/B ratio at `190, the stock is priced at P/B ratio of 4.64x on the pre-issue book value of `40.92 and on the post-issue book value of `100.10, the P/B comes out to 1.90x.
Outlook: The company is present in a fast growing but highly competitive industry. The company operates on very thin margins and is dependent upon a few large customers and a single product category for a substantial portion of its total income. On a post-issue P/E multiple of 19.26 the issue seems to be aggressively priced and fully captures the future growth potential of the company.
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