Financial Analysis of Sameera Agro and Infra IPO

Sameera Agro, primarily focused on infrastructure development and construction activities. However, the company expanded into the agri sector in 2021 and is set to launch its IPO on December 21, 2023. Here's a summary of the company's business model, strengths, weaknesses, and growth prospects to assist investors in making informed decisions.

Sameera Agro and Infra Ltd IPO Overview

Sameera Agro and Infra Ltd, initially incorporated as Sameera Homes in 2002, primarily focused on infrastructure development and construction activities. However, the company expanded into the agri sector in 2021, leading to its current name. The company plans, develops, and constructs residential and commercial spaces, including apartments, townships, complexes, gated communities, bridges, flyovers, industrial parks, water works, and gas pipelines.

In 2021, Sameera Agro and Infra Ltd entered the agricultural domain, involving the processing, drying, sale, purchase, marketing, and distribution of various commodities such as pulses, cereals, and grains. Specific products include urad dal, moong dal, tur dal, black gram, green gram, mung beans, red lentils, yellow dal, split yellow peas, etc. The company presently operates a processing unit near Hyderabad.

Sameera Agro and Infra IPO Strengths

1. Sameera Agro and Infra Ltd's projects, including Savera and Sez Greens, are renowned for their quality, contributing to the development of desirable destinations in Hyderabad and Secunderabad.

2. Led by experienced leaders with over 25 years of real estate expertise

3. Diversified product Portfolio.

4. Increasing demand for agricultural products.

Sameera Agro and Infra IPO Risk

1. A large part of the company's revenue comes from its Agro business. Any negative impact on the demand for this business or on the company's position and reputation can harm its overall business and financial results.

2. Sameera Agro and Infra Ltd relies on Telangana and Andhra Pradesh for the majority of its state-wise revenues in the last three financial years (March 2023, 2022, and 2021). Any potential business loss in these states may negatively impact the company's revenues and profitability.

3. The company relies on a consistent supply of agricultural products like Toor Dal, Urad Dal, Moong Dal, Corn/Maize, and Paddy. Fluctuations in agro prices, taxes, and levies may negatively affect the company's business, financial health, and profitability.

4. A larger portion of the company's revenue relies heavily on a small number of customers.

Sameera Agro and Infra IPO Details

Sameera Agro and Infra IPO is scheduled from December 21 to 27, 2023. The stock has a face value of ₹10 per share, and the IPO's price range is ₹180 per share.

Financial Performance of Sameera Agro and Infra IPO

In the fiscal year 2021, Sameera Agro and Infra generated a Free Cash Flow of ₹52.6 million. However, in the fiscal year 2022, the Free Cash Flow was -₹1.6 million, indicating a negative cash flow. In the fiscal year 2023, the Free Cash Flow improved slightly, reaching ₹0.1 million.

Key Ratios

In FY23, Sameera Agro and Infra saw positive financial performance with a 7.23% PAT margin, a rise from 2.60% in FY22 and 1.52% in FY21. The Return on Equity (ROE) also improved, reaching 53.49% in FY23, compared to 31.35% in FY22 and 20.33% in FY21.

Sameera Agro and Infra Vs Peers

Sameera Agro and Infra Limited, with a face value of Rs. 10 per share, present a P/E ratio of 15.11 and an EPS of 11.91 (in Rs.). In contrast, JK Agri Genetics Ltd, also with a face value of Rs. 10 per share, has a negative P/E ratio of -16.26 and a negative EPS of -23.29. These metrics provide insights into the valuation and earnings performance of the companies. Sameera Agro and Infra Limited's positive P/E ratio and EPS suggest a favorable outlook, while JK Agri Genetics Ltd's negative values indicate potential financial challenges.

Promoters of Sameera Agro and Infra IPO

1. Mr. Satya Murthy Sivalenka

2. Mrs. Kameswari Satya Murthy Sivalenka

Currently promoter holding in the company is 97.49%, but after the IPO's fresh issue of shares, promoter equity holding will be diluted to 69.00%.

Final Words

This article looks closely into the Sameera Agro and Infra IPO, scheduled for subscription from December 21-27 2023. It suggests that potential investors thoroughly review the company's details, financials, subscription status, and the Grey Market Premium (GMP). The GMP indicates the anticipated listing performance, providing valuable insights for investors to make well-informed decisions. As of December 21, Sameera Agro and Infra IPO GMP are trading flat but the GMP will fluctuate as per subscription data and market conditions.