SP Apparels IPO description – SP Apparels is a leading manufacturer and exporter of knitted garments for infants and children in India. These products are manufactured at the company’s integrated facilities that allow it to provide end-to-end garment manufacturing services from greige fabric to finished products. The company also manufactures and retails menswear garments in India under the brand ‘Crocodile’.
SP Apparels’ export business for knitted garments for infants and children constitute a significant portion of its business with nearly 86.13%, 84.62% and 79.84% of its total revenues for the FY2016, 2015 and 2014, respectively, were generated by this business line. The company’s international customers include TESCO and Primark.
The company also manufactures and retails menswear garments in India under the brand ‘Crocodile’ through a sub-license. Nearly 6.43%, 3.39% and 3.35% of its total revenues for the FY2016, 2015 and 2014, respectively were generated by the retail business.
SP Apparels operates 21 manufacturing facilities, all within 125 kilometers of its registered office.
SP Apparels Promoters – P Sundararajan and S Latha
IPO Details
| Subscription Dates | 2 – 4 Aug 2016 |
| Price Band | INR258-268 per share |
| Fresh Issue Size | INR215 crore |
| Offer For Sale | 900,000 shares |
| Face Value | INR10 per share |
| Retail Allocation | 35% |
| Listing On | BSE, NSE |
IPO Objectives
| Fresh issue size | INR215 crore |
| Repayment or prepayment of debt incurred by the company | INR63 crore |
| Expansion and modernization of manufacturing facility at Valapady, Salem, Tamil Nadu | INR70.1 crore |
| Opening of new stores for the sale of ‘Crocodile’ brand products | INR27.8 crore |
| Addition of balancing machineries for dyeing unit at SIPCOT, Perundurai | INR4.9 crore |
| General corporate purposes | – |
Capital structure
|
Major shareholders in SP Apparels | ||
| Name of shareholder | Equity Shares | Percentage (%) |
| P Sundararajan | 11,980,000 | 69.87 |
| S Latha | 3,000,000 | 17.50 |
| S Shantha | 5,000 | 0.03 |
| S Chenduran | 5,000 | 0.03 |
| P Velusamy | 5,000 | 0.03 |
| P Ashokaraman | 5,000 | 0.03 |
| NYLIM (New York Life Investment Management) India Fund II | 1,800,000 | 10.50 |
| Euro Asia | 345,212 | 2.01 |
| Total | 17,145,212 | 100.00 |
Financial performance
|
SP Apparel’s consolidated financial performance (in INR crore) | |||||
| FY2012 | FY2013 | FY2014 | FY2015 | FY2016 | |
| Total revenue | 401.6 | 428.8 | 452.0 | 479.2 | 537.7 |
| Total expenses | 397.0 | 424.7 | 440.2 | 454.8 | 492.8 |
| Profit after tax | 9.7 | 2.4 | 6.7 | 10.0 | 34.7 |
SP Apparels IPO Subscription Details
| Category | Shares offered | Subscription (no. of times) | ||
| Day 1 | Day 2 | Day 3 | ||
| QIB | 1,939,905 | 0.00 | 0.99 | 2.20 |
| NII | 1,385,010 | 0.07 | 0.45 | 5.10 |
| Retail | 3,231,690 | 0.21 | 0.54 | 1.88 |
| Total | 6,556,605 | 0.12 | 0.65 | 2.65 |
SP Apparels IPO Allotment Status
SP Apparels IPO allotment status will be available on Link Intime’s website. Click on this link to get allotment status on 10 August 2016.
You can also check your IPO allotment status from your mobile at
http://eipo.linkintime.co.in/ipo/
http://linkintime.co.in/ipo
SP Apparels Contact Details
SP Apparels Ltd
39-A, Extension Street,
Kaikattipudur Avinashi,
Tirupur 641 654
Phone: +91 4296 304 000
Fax: +91 4296 304 280
Email: [email protected]
Website: www.spapparels.com
Registrar of SP Apparels IPO
Link Intime India Private Limited
C-13 Pannalal Silk Mills Compound,
LBS Marg, Bhandup West, Mumbai – 400 078
Maharashtra, India
Phone: +91 22 2596 3838
Fax: +91 22 2594 6969
Email: [email protected]
Website: http://www.linkintime.co.in
Listing Performance of SP Apparels IPO
IPO Opening Date: 2 August 2016
IPO Closing Date: 4 August 2016
Finalisation of Basis of Allotment: 9 August 2016
Initiation of refunds: 10 August 2016
Transfer of shares to demat accounts: 11 August 2016
Listing Date: 12 August 2016
Listing Price on NSE: INR275 per share (return of 2.6% over IPO price)
Closing Price on NSE: INR288.75 per share (return of 7.7% over IPO price)
Asking price leaves little scope for capital appreciation.The sudden spurt in profits just before IPO needs a careful study.The steady increase in top line appears to be on account of depreciation of the INR to a major extent.The brand crocodile is a ripoff of the Lacoste brand.Earnings in GBP/ Euro are going to face the BREXIT aftermath of currency depreciation.TESCO does not sell top end products . It mainly caters to lower end of the market where margins are already low..Company appears to be mainly selling to Tesco. The sector itself is crowded and China, Taiwan etc are big players. The garment industry survives by exploiting the labor . I feel there are better companies in this sector itself and hence no compelling reasons to put my money in this IPO to enrich the promoters.
True, the books look cooked up. Avoid at every cost. Instead of apparels, may be they should get into food business since they are so good at cooking stuff.