Saraswati Saree Depot IPO Review

Saraswati Saree Depot Limited is a wholesaler of sarees, kurtis, lehengas, and other womens’ ethnic wear garments, with a management spanning three generations, a workforce with decades of experience, networks across the country and a loyal customer base.

The Company is led by strong promoters named Mahesh Dulhani have over 30 years of experience, Shankar Dulhani have over 38 years of experience, Rajesh Dulhani have over 29 years of experience and Vinod Dulhani have over 27 years of experience, in the apparel industry. 

Financially, Saraswati Saree revenue increased from ₹5,503.08 Millions in FY22 to ₹6,035.18 Millions in FY23 and currently increased to ₹6,125.80 Millions in FY24. Similarly, EBITDA also increased from ₹208.46 Millions in FY22 to ₹340.53 Millions in FY23 and currently increased at ₹411.41 Millions in FY24. The PAT also increased from ₹123.08 Millions in FY22 to ₹229.74 Millions in FY23 and currently increased at ₹295.28 Millions in FY24. This indicates a steady financial performance.

For the Saraswati Saree IPO, the company is issuing shares at a pre-issue EPS of ₹8.92 and a post-issue EPS of ₹7.45. The pre-issue P/E ratio is 17.93x, while the post-issue P/E ratio is 21.47x against the industry P/E ratio of 46.57x. The company's ROCE for FY24 is 64.46% and ROE for FY24 is 58.88%. These metrics suggest that the IPO is fairly priced.

The Grey Market Premium (GMP) of Saraswati Saree indicates potential listing gains of 45% - 50%. Given the company's financial performance and the valuation of the IPO, we recommend Investors to Apply the Saraswati Saree Depot Limited IPO for Listing gain or long term investment purposes.