Introduction
The last week of 2022 brought another investment opportunity for investors in the form of an IPO. Sah Polymers Limited is coming up with an IPO this week. This is a material subsidiary of SAT Industries Limited and is engaged in the B2B business segment with a good domestic as well as international presence.
Sah Polymers Limited IPO was open for subscription from 30th December 2022 till 4th January 2023. The IPO was subscribed 17.46 times as of the last day of bidding.
Here are all the essential details of Sah Polymers Limited IPO, including investment price band, allotment date, GMP, benefits, risks of investing in this IPO, and more.
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IPO Details
The key details of the Sah Polymers Limited IPO are as under.
- IPO Size
The size of the IPO and different categories of the issue are:
| Category | Details |
| IPO Opening Date | 30th December 2022 |
| IPO Closing Date | 4th January 2023 |
| Listing | NSE, BSE |
| Issue Type | Book Built Issue IPO |
| Face Value of shares | Rs. 10 per share |
| IPO Price Band | Rs. 61 – Rs. 65 per share |
| IPO Size | Rs. 66 crores (1,02,00,000 equity shares) |
| Offer For Sale | – |
| Fresh Issue | Rs. 66 crores (1,02,00,000 equity shares) |
- IPO Dates
The important dates for the Sah Polymers Limited IPO are highlighted below:
| Event | Date |
| Opening date | 30th December 2022 |
| Closing Date | 4th January 2023 |
| Allotment date | 9th January 2023 |
| Refund Date | 10th January 2023 |
| Share Credit Date | 11th January 2023 |
| Listing Date | 12th January 2023 |
- IPO Lot Sizes
Investors can subscribe to the shares of Sah Polymers Limited IPO in pre-defined lots. The details of the lot sizes for this IPO are mentioned below:
| Category | Details |
| Investment in lots (for retail investors) | Minimum – 1 lotMaximum – 13 lots |
| Shares | Minimum – 230Maximum – 2990 |
| Investment amount | Minimum – Rs. 14,950Maximum – Rs. 1,94,350 |
- IPO Reservation
The categories of eligible investors and their share in the IPO are tabled below:
| Category of Investor | Reservation Percentage |
| QIB (Qualified Institutional Buyers) | 75% |
| NII (Non-Institutional Bidders) | 15% |
| RII (Retail Individual Investors) | 10% |
Sah Polymers Limited IPO Objectives
The key objectives of the IPO are stated below:
- The primary objective of the IPO is to utilise the proceeds for setting up a manufacturing facility for the manufacture of a new variant of Flexible Intermediate Bulk Containers (FIBC).
- The proceeds will then be utilised for the repayment of existing secured and unsecured borrowings of the company.
- The company will further allocate a portion of the IPO proceeds to meet its working capital requirements.
- The balance proceeds will be used for general corporate purposes.
Top things to know about Sah Polymers Limited IPO
Sah Polymers Limited is engaged in the business of manufacturing and selling Polypropylene (PP)/High-Density Polyethylene (HDPE) FIBC Bags, Woven Sacks, HDPE/PP woven fabrics, and woven polymer.
It also offers customised packaging solutions to its B2B segment customers belonging to diverse sectors like:
- Agro Pesticides Industry
- Basic Drug Industry
- Cement Industry
- Chemical Industry
- Fertiliser Industry
- Food Products Industry
- Textile Industry Ceramic Industry
- Steel Industry.
The company generates its revenues through domestic sales as well as exports having a presence in 6 states and 1 Union territory as well as 6 international regions Africa, the Middle East, Europe, the USA, Australia, and the Caribbean.
Sah Polymers has a manufacturing facility in Udaipur, Rajasthan with an installed capacity of 3960 m.t.p.a and A dedicated staff of 97 employees on the payroll as of 31st March 2022.
Financials of the company
Sah Polymers Limited financials are given in the table below:
| Year | Total Assets (Rs. In crores) | Operating Revenue (Rs. In crores) | Profit after tax (Rs. In crores) | Basic EPS(Rs.) | Diluted EPS(Rs.) | RONW |
| Mar-2022 | 68 | 80 | 4.37 | 2.18 | 2.18 | 16.42% |
| Mar-2021 | 41 | 55 | 1.27 | 0.82 | 0.82 | 6.33% |
| Mar-2020 | 36 | 49 | 0.03 | 0.19 | 0.19 | 1.58% |
(Source: RHP)
Strengths of the company
Some of the key strengths of Sah Polymers Limited that investors can take note of are:
| Category | Details |
| Business model | The company has a diverse product portfolio with stringent quality checks at various production levelsThe product errors are rectified in real-time as part of enhanced quality control. The new manufacturing facility will further enhance the production capacity and broaden the product portfolio. |
| Customer base | The company has a diverse customer base belonging to various industriesThey also have a strong export segment by having a presence in 14 countries |
Risks of investment
Here are some of the risks that investors of Sah Polymers Limited IPO should know:
| Category | Details |
| Business viability and profitability | A significant portion of the company’s revenue is concentrated in the hands of limited customers.The current and new manufacturing facility is in the same geographic area, therefore, any adverse situation in this region will have a huge impact on the business. The business will also be impacted on account of inadequate or interrupted supply of raw materials or packaging materials or their price fluctuations. |
| Competition | The company’s customers belong to industry segments that are quite fragmented.The company also faces severe competition from small and big competitors. |
| Litigations | The company, its group company, the corporate promoter Directors, and the subsidiary are part of certain litigationsThe name of one of the promoter group companies appears in the willful defaulter list of RBI issued by CIBIL |
What is the Grey Market Premium (GMP) of Sah Polymers Limited IPO?
As of December 9th Jan, 2022, the grey market premium for the shares of Sah Polymers Limited is approximately Rs. 3 as per market observers.
Should you buy Sah Polymers Limited?
The company has reported good financials and also a strong PAT margin as compared to many of its listed peers. The ROE margin of Sah Polymers is also better than many of its peers but the ROCE needs to be reviewed. With the infusion of fresh capital and the setting up of a new manufacturing facility, the company is set to improve its production capacity and meet the additional demand in this sector. Investors can therefore consider this stock as part of their portfolio after careful consideration of personal risk-return preferences.
How to apply for Sah Polymers Limited IPO?
Investors can invest in this IPO through the Fisdom app.
Sah Polymers Limited IPO FAQs
Sah Polymers Limited has an EBITDA margin of 9.61% and is within the industry average when compared to its listed peers.
The bid for anchor investors for Sah Polymers IPO was open from 29th December 2022.
Sah Polymers Limited is offering 1,02,00,000 equity shares of face value Rs. 10 per share as a fresh issue with the price band of Rs. 61 to Rs. 65 and the IPO size of Rs. 66 crores.
Sah Polymers Limited exports its products to 14 countries in 6 international regions belonging to Africa, the Middle East, Europe, the USA, Australia, and the Caribbean and they contributed to approximately 55% of its revenue in FY 22.
The lead manager and Registrar of Sah Polymers IPO is Pantomath Capital Advisors Pvt Ltd. and Link Intime India Private Limited.
