Three M Paper Boards IPO Review

Three M Paper Boards Limited (Formerly known as Three M Paper Boards Private Limited and Three M Paper Manufacturing Company Private Limited) is engaged in manufacturing a Coated Duplex Paper Board suitable for printing and packaging application.

The promoter, Mr. Hitendra Dhanji Shah, has been associated with the paper industry for more than three decades, having wide experience in marketing, management, and administration and having in-depth knowledge of the paper industry.

Financially, Three M Paper Boards revenue jumped from ₹16,552.14 Lakhs in FY21 to ₹31,600.49 Lakhs in FY22 and further increased to ₹32,974.92 Lakhs in FY23 and currently increased to ₹27,601.56 Lakhs in FY24. Similarly, EBITDA increased from ₹1,455.36 Lakhs in FY21 to ₹1,754.76 Lakhs in FY22 and further increased to ₹2,166.30 Lakhs in FY23 and currently at ₹2,706.84 Lakhs in FY24. The PAT also increased from ₹172.63 Lakhs in FY21 to ₹327.56 Lakhs in FY22 and further jumped to ₹661.53 Lakhs in FY23 and currently at ₹1,134.72 Lakhs in FY24. This indicates a steady growth in financial performance.

For the Three M Paper Boards IPO, the company is issuing shares at a pre-issue EPS of ₹8.60 and a post-issue EPS of ₹5.89. The pre-issue P/E ratio is 8.02x, while the post-issue P/E ratio is 11.71x against the industry P/E ratio of 10.11x. The company's ROCE for FY24 is 19.71%, and ROE for FY24 is 18.57%. These metrics suggest that the IPO is fairly priced.

The Grey Market Premium (GMP) of Three M Paper Boards indicates potential listing gains of 50% - 55%. Given the company's financial performance and the valuation of the IPO, we recommend Investors to apply for listing gains or long term investment purposes.