Bang Overseas IPO
Bang Overseas IPO - Subscription , Alloment Status , Listing date , Listing Price
Company Background
- Bang Overseas Ltd (BOL) was incorporated in 1992 as Bang Overseas Pvt Ltd to carry on the business of trading in textiles. It converted to Public Ltd Co. in 2005.
- Presently, BOL is in the business of manufacturing & trading of apparels and trading of fashion fabrics. The company owns the brand name of ‘Bodywaves’ and ‘Thomas Scott’ for fabric collections in textile and ready to wear mens’ garment respectively. The company has applied for ‘Miss Scott’ for registration as brand for women’s apparel.
- BOL has two manufacturing units in Bangalore with present installed capacity of 7,20,000 & 5,40,000 pieces per annum. The company has planned to set up another unit in Banagalore with installed capacity of 6,00,000 pieces per annum.
- BOL also has planned to offer more lifestyle products under their brands along with accessories namely sunglasses, belts, time wear, fashion jewellery and fragrances.
- The company has centralised warehousing and logistic centre at Kalher Village near Bhiwandi to facilitate supply chain management of the business.
- Currently, BOL retailed its products through 157 points of sales comprises of Retail outlets (company owned), Large format stores (Eg. - Shopper’s Stop, Pyramid, Globus, the LOOT & SAGA) and other Multi brand outlet. The company owned 12 Retail outlets including three franchisee and is planning to scale up the same to 100 including 50 franchisee.
- Thomas Scott brand contributed 23.46% and 29.47% during half year ended September 30, 2007 and FY 07 respectively in the total garment sales aggregating to Rs. 22.37 cr and Rs 35.61 cr.
- BOL has a subsidiary named Vedanta Creations Pvt. Ltd. which is also engaged in textile business.
- Post issue Promoter and Promoter group shareholding will reduce from 91.74% to 68.06%.
Objects of the issue
- To set up Retail outlets across India and brand building
- To set up a new apparel manufacturing unit
- To set up Warehousing and Logistic facilities
Strength
- Inventory turnover ratio has increased from 2.67 in FY 03 to 7.17 in FY 07.
- Debtors turnover ratio has increased from 2.37 in FY 03 to 17.18 in FY 07.
- Interest coverage ratio has increased from 1.08 in FY 03 to 6.89 in FY 07.
- OPM has increased from 6.21% in FY 03 to 19.91% in FY 07. For half year ended September 07, OPM was 18.42%.
Weakness
- Book value per share has decreased from Rs 70.92 in FY 03 to Rs 19.13 in FY 07. The same for half year ended September 07 is Rs 28.46.
- Fixed Assets turnover ratio has decreased from 51.61 times in FY 03 to 10.12 times in FY 07. The reason being significant investment in fixed assets.
Valuation
- Operating Income has increased at CAGR of 70% from Rs 11.56 cr in FY 03 to Rs 96.62 cr in FY 07. Income from Trading constitutes 88.95% in FY 03 & 63.06% in FY 07 while Manufacturing constitutes 11.05% in FY 03 & 36.94% in FY 07.
- Net Profit has increased from Rs 0.034 cr in FY 03 to Rs 10.79 cr in FY 07. For half year ended September 07, the same was Rs 7.04 cr.
- Material cost to Operating income increased from 67% in FY 03 to 71% in FY 07. For half year ended September 07, the same was 63.82%.
- Manufacturing cost to Operating income has increased from5.25% in FY 03 to 6.55% in FY 07. For half year ended September 07, the same was 9.46%.
- Total expense to Total revenue has decreased from 94.49% in FY 03 to 81.57% in FY 07. For half year ended September 07, the same was 83.92%.
- Debt-Equity ratio has decreased from 2.28 in FY 03 to 1.30 in FY 07.
- RONW has increased from 1.71% in FY 03 to 32.88% in FY 06. The same has increased to 57.57% in FY 07
- EPS has increased from Rs 1.21 in FY 03 to Rs 11.01 in FY 07 Annualized EPS (based on half year ended September 07) is Rs 14.
- Post issue PE based on Annualized PAT for FY 08 at the lower end of the price band is 19.27 & at the upper end of the price band is 19.94. The shares are being offered at the range of Rs 200/- to Rs 207/-.
- This info is collected from IndiaBulls Trading Portal.
