IPO Analysis of Jyoti CNC Automation
Last Updated: 4th January 2024 - 04:43 pm
What they Do?
Jyoti CNC Automation Limited is a CNC machine manufacturer & supplier. The business is headquartered in India & focuses on producing & distributing CNC machinery.
What are their Product Range?
What are their Customer Base?
Along with the clients mentioned above, the clientele is Shreeram Aerospace & Defense, Rolex Rings, Harsha Engineers, Bosch Limited, HAWE Hydraulics, Festo India, Elgi Rubber, National Fittings & others.
Jyoti CNC Automation Limited Financial Summary
Analysis
Assets: The company's total assets have fluctuated over the periods, reaching a peak at ₹ 1,706 crore as of September 2023. This suggests potential growth & investment but may also indicate increased financial risk.
Revenue: Revenue has shown a positive trend, rising from ₹ 590 crore in March 2021 to ₹ 953 crore in March 2023. However, a dip in September 2023 to ₹ 511 crore requires scrutiny to identify potential factors affecting sales.
Profit After Tax: Despite initial losses in March 2021 & 2022, the company has turned a profit, albeit modest, with ₹ 3 crore in September 2023. The positive trajectory signals improving financial health but highlights a need for sustained profitability.
Net Worth: The company's net worth has experienced a significant turnaround, growing from a negative ₹ 30 crore in March 2022 to a robust ₹ 206 crore in September 2023, indicating successful efforts in strengthening the financial position.
Reserves & Surplus: Reserves & surplus have shown consistent growth, reaching ₹ 213 crore in September 2023. This signals financial stability & a strong foundation for future expansion or strategic initiatives.
Total Borrowing: The company's borrowing remained relatively stable around ₹ 800 crore, indicating a cautious approach to leveraging.
Jyoti CNC Automation IPO Peer Comparison
Company Name | EPS (Basic) | EPS (Diluted) | NAV (per share) (₹) | P/E (x) | RoNW (%) |
Jyoti CNC Automation Limited | 1.02 | 1.02 | 5.57 | N/A | 18.35 |
Elgi Equipments Limited | 11.72 | 11.71 | 43.27 | 44.3 | 27.04 |
Lakshmi Machine Works Limited | 359.47 | 359.47 | 2,189.04 | 37.69 | 16.42 |
Triveni Turbine Limited | 5.97 | 5.97 | 23.92 | 67.76 | 25.32 |
TD Power Systems Limited | 6.23 | 6.22 | 38.74 | 46.66 | 16.01 |
Macpower CNC Machines Ltd | 12.89 | 12.89 | 96.61 | 51.31 | 13.34 |
Average | 66.22 | 66.21 | 399.53 | 49.54 | 19.41 |
Analysis
EPS (Earnings Per Share): Jyoti CNC's EPS (Basic & Diluted) at 1.02 indicates moderate earnings compared to peers. This suggests a steady but not exceptional profit performance.
NAV (Net Asset Value) per share: Jyoti CNC's NAV per share at 5.57 is significantly lower than the peer average of 399.53. This could imply a comparatively smaller asset base or potential undervaluation.
P/E Ratio (Price-to-Earnings): With a P/E ratio of 18.35, Jyoti CNC is below the average of 49.54, suggesting a relatively lower valuation compared to peers. This might be appealing to investors seeking undervalued stocks.
RoNW (Return on Net Worth): Jyoti CNC's RoNW at 19.41% is close to the peer average, indicating a reasonably efficient utilization of equity. However, it's crucial to assess if the RoNW is sustainable & competitive in the industry.
Interpretation
Strengths: Jyoti CNC appears to have a conservative valuation (lower P/E) & a relatively efficient utilization of equity (comparable RoNW).
Weaknesses: The lower EPS & NAV compared to peers might suggest a smaller scale of operations or potential challenges in generating higher earnings & building substantial assets.
Recommendation: Jyoti CNC should emphasize strategies to boost earnings & enhance its asset base to attract investors. Communicating a clear growth plan & addressing any underlying challenges will be essential for a successful IPO.
Investor Caution: Potential investors should carefully evaluate the company's growth prospects, industry position, & competitive advantages, considering the lower NAV & EPS compared to industry peers.
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