Davin Sons Retail IPO Review

The business is categorised in two categories:
1. Manufacturer of Garments;
2. Distribution of FMCG products.

Under the Garment segment, they are engaged into the business of manufacturing and designing of readymade garments offering diverse range of high-quality jeans, denim fabrics, denim jackets and t-shirts for other brands. Davin Sons Retail Limited is part of the Fast-Moving Consumer Goods (FMCG) industry which continues to be one of the biggest long-term sustainable business opportunities that our country offers.

The Company is led by the Promoters Mr. Mohit Arora and Mr. Nohit Arora, who are in the field of garment designing, manufacturing and trading for more than 10 years. They started off with some small & medium sized brands which could give him some consistent business and also, they can place himself in the market.

The Revenues from operations for the period ended on Sep 30, 2024, Fiscals ended 2024 and 2023 were ₹ 634.10 Lakh, ₹ 1,339.16 Lakh and ₹ 391.33 Lakh respectively. The EBITDA for the period ended on Sep 30, 2024, Fiscals ended 2024 and 2023 were ₹ 153.40 Lakh, ₹ 388.49 Lakh and ₹ 86.16 Lakh respectively. The Profit after Tax for the period ended on Sep 30, 2024, Fiscals ended 2024 and 2023 were ₹ 73.59 Lakh, ₹ 164.05 Lakh and ₹ 56.62 Lakh respectively. This indicate a steady growth in financial performance.

The Company Key Performance Indicates the pre-issue EPS of ₹4.63 and post-issue EPS of ₹3.12 for FY24. The pre-issue P/E ratio is 11.88x, while the post-issue P/E ratio is 17.64x. The company's ROCE for FY24 is 54.52%, ROE for FY24 is 49.41% and RoNW 29.58%. The Annualised EPS based on the latest financial data is ₹4.02 and PE ratio is 13.68x. These metrics suggest that the IPO is fairly priced.

The Grey Market Premium (GMP) of Davin Sons Retail showing potential listing gains of 14.54%. Given the company's financial performance and the valuation of the IPO, we recommend Investors to Avoid to the Davin Sons Retail Limited IPO for Listing gain.

Disclaimer: The information provided in this IPO review is for educational and informational purposes only and should not be construed as financial advice or an offer to buy or sell securities. The review must not be used as a singular basis of any investment decision. The views herein are of a general nature and do not consider the risk appetite or the particular circumstances of an individual investor; readers are requested to take professional advice before investing. Nothing in this document should be construed as investment advice. The content is based on publicly available information and market perceptions as of the date of publication and is subject to change. Neither the author nor the website is responsible for any losses or damages arising from the use of this information. 

About the Author
 CA Abhay Kumar (Also known as  CA Abhay Varn) is a qualified Chartered Accountant by profession and cleared CA at age 21. He is a SEBI Registered Research Analyst with Registration Number - INH300008465. He Possesses 8+ years of experience in the Stock Market Field and has also worked in Big CA firms during the training period. He is good at Technical analysis and Fundamental Analysis and uses both Technical and Fundamental analysis along with five other important factors that affect the movement of the Market namely Global Market Analysis, Upcoming Event Analysis, Institutional Money Analysis, Derivative Data Analysis, and Emotions and Sentiment of Traders and Investors in his Framework called - Technical Fundamental GUIDE to find the winning Trades