Subscribe to Shree Ganesh IPO with long term view: Arihant
Arihant Capital Market has advised investors to subscribe to the initial public offering of Shree Ganesh Jewellery House with a long term view in mind.
By ET Bureau |
MUMBAI: Arihant Capital Market has advised investors to subscribe to the initial public offering of Shree Ganesh Jewellery House with a long term view in mind.
Shree Ganesh Jewellery House Limited (SGJHL) is one of India’s largest manufacturer and exporter of handcrafted gold jewellery. It proposes to diversify into the manufacturing of machine made jewellery, diamond studded jewellery at the proposed plants, and intends to expand the chain of retail outlets.
“Considering the P/E valuation, the company is trading at a P/E of 9.77x times on the lower side and 10.15x times on the higher side of its 6 month annualized FY10 EPS of Rs 26.60 which we believe are at a discount to its peers in the industry.
The limited experience in setting up and operating a manufacturing facility and under taking retail operations at a larger scale poses risks. However, keeping in mind its strategic location, strong execution capabilities, increasing repeat business, strong performance along with the management’s proven execution capabilities, we recommend our investors to SUBSCRIBE to the issue with a long term view in mind,” the report said.
Shree Ganesh Jewellery House entered the capital market with public issue of 1.43 crore shares in the price band of Rs 260-270 per share of face value of Rs 10 each. The issue closes Tuesday.
The company plans to use the proceeds for adding capacities, diversifying its product offerings, spreading its geographical presence, scaling up its retail chain segment and setting up of a gold refining facility.
Shree Ganesh Jewellery House Limited (SGJHL) is one of India’s largest manufacturer and exporter of handcrafted gold jewellery. It proposes to diversify into the manufacturing of machine made jewellery, diamond studded jewellery at the proposed plants, and intends to expand the chain of retail outlets.
“Considering the P/E valuation, the company is trading at a P/E of 9.77x times on the lower side and 10.15x times on the higher side of its 6 month annualized FY10 EPS of Rs 26.60 which we believe are at a discount to its peers in the industry.
The limited experience in setting up and operating a manufacturing facility and under taking retail operations at a larger scale poses risks. However, keeping in mind its strategic location, strong execution capabilities, increasing repeat business, strong performance along with the management’s proven execution capabilities, we recommend our investors to SUBSCRIBE to the issue with a long term view in mind,” the report said.
Shree Ganesh Jewellery House entered the capital market with public issue of 1.43 crore shares in the price band of Rs 260-270 per share of face value of Rs 10 each. The issue closes Tuesday.
The company plans to use the proceeds for adding capacities, diversifying its product offerings, spreading its geographical presence, scaling up its retail chain segment and setting up of a gold refining facility.
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