Apex Ecotech, a rapidly growing company in its sector, is set to launch its Initial Public Offering (IPO) on November 27, 2024, and close on November 29, 2024. This Book Built Issue aims to raise approximately ₹25.54 crores, comprising entirely of fresh equity issuance. The company has shown consistent growth in its financial performance, making this IPO an attractive opportunity for investors, particularly those with a long-term outlook. Below is a detailed breakdown of the IPO, its financial highlights, valuation metrics, and industry outlook.
Key IPO Details
- IPO Open Date: November 27, 2024
- IPO Close Date: November 29, 2024
- Issue Type: Book Built Issue
- Face Value: ₹10 per equity share
- Price Band: ₹71 to ₹73 per share
- Issue Size: ₹25.54 crores
- Fresh Issue Size: ₹25.54 crores
- Retail Quota: 35%
- QIB Quota: 50%
- NII (HNI) Quota: 15%
- Listing Exchange: NSE SME
- Allotment Date: December 2, 2024
- Listing Date: December 4, 2024
Market Lot and Application Amount
The IPO market lot for Apex Ecotech is designed for both retail and high-net-worth individuals (HNIs), making it accessible to a broad spectrum of investors.
| Application | Lot Size | Shares | Amount (₹) |
|---|---|---|---|
| Retail Minimum | 1 | 1,600 | ₹116,800 |
| Retail Maximum | 1 | 1,600 | ₹116,800 |
| S-HNI Minimum | 2 | 3,200 | ₹233,600 |
IPO Timeline
| Event | Date |
|---|---|
| IPO Open Date | November 27, 2024 |
| IPO Close Date | November 29, 2024 |
| Basis of Allotment | December 2, 2024 |
| Refunds | December 3, 2024 |
| Credit to Demat Accounts | December 3, 2024 |
| Listing Date | December 4, 2024 |
Company Overview and Promoters
Apex Ecotech specializes in [industry details to be updated]. The company has demonstrated strong financial growth and operational efficiency, which are critical factors for investor confidence. The IPO proceeds will be used for [specific purposes such as debt reduction, capacity expansion, working capital, etc.].
The company is promoted by experienced industry veterans:
- Mr. Anuj Dosajh
- Mr. Ramakrishnan Balasundaram Aiyer
- Mr. Ajay Raina
- Mr. Lalit Mohan Datta
Their leadership has been instrumental in driving the company’s growth trajectory, ensuring robust performance across all financial parameters.
Financial Performance
Apex Ecotech has shown a steady increase in revenue and profitability, reflecting its operational efficiency and market potential.
| Year | Revenue (₹ Cr) | Expenses (₹ Cr) | Profit After Tax (₹ Cr) | Assets (₹ Cr) |
|---|---|---|---|---|
| 2022 | 20.03 | 20.55 | 0.66 | 9.79 |
| 2023 | 34.92 | 30.76 | 3.52 | 17.68 |
| 2024 | 53.46 | 44.49 | 6.63 | 25.56 |
Key Highlights:
- Revenue Growth: Revenue surged by 53% in FY2024 compared to FY2023, highlighting strong demand and operational scalability.
- Profitability: Profit after tax (PAT) nearly doubled from ₹3.52 crore in FY2023 to ₹6.63 crore in FY2024.
- Asset Growth: Total assets grew from ₹17.68 crore in FY2023 to ₹25.56 crore in FY2024, indicating robust reinvestment and expansion strategies.
Valuation Metrics
Apex Ecotech’s financial metrics showcase its strong fundamentals and operational efficiency.
| Metric | Value |
|---|---|
| Return on Equity (ROE) | 60.38% |
| Return on Capital Employed (ROCE) | 59.61% |
| EBITDA Margin | 16.73% |
| PAT Margin | 12.49% |
| Debt-to-Equity Ratio | 0.03 |
| Earnings Per Share (EPS) | ₹7.25 (Basic) |
| Net Asset Value (NAV) | ₹16.11 |
Analysis:
- High ROE and ROCE: The company’s ROE of 60.38% and ROCE of 59.61% reflect excellent profitability and efficient capital utilization.
- Low Debt: A debt-to-equity ratio of 0.03 underscores the company’s strong balance sheet, minimizing financial risk.
- Healthy Margins: EBITDA and PAT margins of 16.73% and 12.49%, respectively, indicate strong operational performance and cost management.
Peer Comparison
Apex Ecotech competes with established players like ION Exchange Limited and VA Tech Wabag Limited in its sector. A comparative analysis highlights Apex Ecotech’s competitive strengths:
| Company | EPS (₹) | PE Ratio | RoNW (%) | NAV (₹) | Revenue (₹ Cr) |
|---|---|---|---|---|---|
| Apex Ecotech | 7.25 | N/A | 60.38% | 16.11 | 53.46 |
| ION Exchange Limited | 13.32 | 53.89 | 21.06% | 69.53 | 2,347.85 |
| VA Tech Wabag Limited | 36.87 | 34.10 | 14.45% | 293.28 | 2,856.40 |
While Apex Ecotech is smaller in scale, its superior RoNW and high-growth potential make it an appealing investment opportunity.
IPO Investment Insights
Strengths:
- Strong Financial Growth: The company has consistently grown revenue and profits, reflecting its competitive edge and market demand.
- Efficient Management: High ROE, ROCE, and healthy margins demonstrate strong operational management.
- Low Debt Levels: The minimal debt-to-equity ratio reduces financial risk, making the company more stable.
Risks:
- Competitive Landscape: The company operates in a sector with well-established players, which may affect market share.
- SME Listing: As an NSE SME-listed company, liquidity and trading volumes might be lower compared to mainboard IPOs.
- Sector-Specific Risks: Dependence on industry trends and regulatory changes could impact performance.
Investment Strategy
Investors considering Apex Ecotech IPO should assess the following:
- For Long-Term Investors: The company’s robust financial growth, efficient operations, and market potential make it a promising candidate for long-term portfolio inclusion.
- For Retail Investors: With a 35% retail quota, the IPO offers a favorable allocation for individual investors.
- For Risk-Tolerant Investors: The SME segment typically involves higher risks but can offer substantial returns for those willing to stay invested.
Conclusion
The Apex Ecotech IPO represents a compelling opportunity for investors seeking exposure to a high-growth company with strong financial fundamentals. With a significant revenue and profit increase in FY2024, coupled with excellent ROE and low debt, Apex Ecotech showcases the attributes of a stable yet scalable business.
While there are risks associated with SME listings and competitive dynamics, the company’s growth trajectory and operational efficiency position it favorably in its sector. The IPO is particularly attractive for long-term investors aiming to capitalize on the company’s expansion and value creation potential.
With a price band of ₹71-₹73 per share and a total issue size of ₹25.54 crores, Apex Ecotech’s IPO provides an affordable entry point for retail investors. Whether you’re a seasoned investor or a newcomer, this IPO is worth considering for its growth prospects and financial strength.