Sah Polymers IPO

Last Updated: 10 January 2023 12:13 AM by rahul_raskar

Sah Polymers IPO opens on 30th December and closes on 4th January. The issue consists of a fresh issue of 10,200,000 equity shares worth of Rs. 66.30 crores. The lot size is fixed at 230 shares while the price band is fixed at Rs. 61- Rs. 65 per share. The issue will be listed on NSE and BSE on 12th January while the allotment of shares will take place on 9th January. Pantomath Capital Advisors is the leading book manager for the issue. 

Objective of Sah Polymers IPO

The net proceeds from the issue will be utilised for:

•    Rs. 8.18 crores will be used for setting up of a new manufacturing facility to manufacture new variant of Flexible Intermediate Bulk Containers (FIBC)
•    Rs. 19.66 crores for repayment/ Prepayment of certain secured and unsecured borrowings in full or part availed by the Company and the Subsidiary Company
•    Rs. 14.95 crores funding the working capital requirements of the Company and general corporate purposes
 

Sah Polymers IPO Video

The company, led by Asad Daud and professionally backed by Hakim Sadiq Ali Tidiwala and Murtaza Ali Moti, is primarily engaged in manufacturing and selling of Polypropylene (PP)/ High Density Polyethylene (HDPE) FIBC Bags, Woven Sacks,HDPE/PP woven fabrics, based products of different weight, sizes and colours as per customers specifications. 

It offers customised bulk packaging solutions to business-to-business (“B2B”) manufacturers catering to different industries such as Agro Pesticides Industry, Basic Drug Industry, Cement Industry, Chemical Industry, Fertilizer Industry, Food ProductsIndustry, Textile Industry Ceramic Industry and Steel Industry. It is also a Del Credere Associate cum Consignment Stockist (DCA/ CS) of Indian Oil Corporation Limited and also operates as Dealer Operated Polymer Warehouse (DOPW) of Indian Oil Corporation Limited for their polymer division

Return on net-worth is 16.42% and PAT margin for the year ended 2022 stood at 5.39%. The Company’s sales have grown from Rs. 49.90 crores in FY  2020 to Rs. 81.23 crores in FY 22. The sales for the quarter ended June 2022 stood at Rs.27.59 crores. Thus the sales CAGR for last three completed years is 27.6%. Similarly, the post-tax profits, i.e., PAT of the Company has increased with CAGR of 284% over last three years.

The Company operates at 85% to 92% of the installed capacity and therefore going for further capex. Total capex is Rs. 33.81 crores, out of which the Company has taken bridge loan of Rs. 15.71 crores from the holding company and deployed while the IPO approvals came so that the overall timeframe of the installation is not delayed. The new Project is estimated to commence commercial operations within this year 2022-23 itself.

The total equity issued before IPO is 15.59 crores and along with reserves the net-worth is Rs 27.74 crores as at the end of the 30th June 2022. Post IPO, the Company’s net-worth shall stand at Rs 92.95 crores. The Book value post IPO would be 36 plus the profit surplus for the period.
It has two business divisions (i) domestic sales; and (ii) exports. The company has presence in 5 states and 1 union territory with one manufacturing facility in Rajasthan. Sah Polymers exports its products to 14 countries such as Algeria, Togo, Ghana, Poland, Portugal, France, Italy, Dominican Republic, USA, Australia, UAE, Palestine, UK and Ireland. For the 3 months ended June 30, 2022 and for Fiscals 2022, the Company’s revenue from exports contributed 57.61% and 55.14%, respectively, of total revenues from operations.

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Peer Comparison

Kanpur Plastipack Ltd., Rishi Techtex Ltd., Gopala Polyplast Ltd., Jumbo Bag Ltd., SMVD Polypack Ltd., EMMBI Industries Ltd., and Commercial Syn. Bags Ltd. are competitors; however, the peers are not directly comparable due to the type, range of products/services, turnover, and size of the firm.