3B Films Limited, a prominent player in the manufacturing and supply of CPP (Cast Polypropylene) and CPE (Cast Polyethylene) films, has launched its Fixed Price Initial Public Offering (IPO) on May 30, 2025. The company’s products serve a vital role in the flexible packaging industry and thermoforming applications, catering to diverse sectors including food and beverage, clothing, flowers, and other consumer goods. The IPO aims to raise ₹33.75 Crores through a fresh issue of 35.52 lakh shares aggregating to ₹17.76 Crores, alongside an Offer for Sale of 31.98 lakh shares totaling ₹15.99 Crores.

The share price is fixed at ₹50 per equity share, positioning the company’s market capitalization at ₹123.86 Crores based on the IPO price. The IPO lot size is set at 3,000 shares, requiring a minimum retail investment of ₹1,50,000 and ₹3,00,000 for High-Net-Worth Individuals (HNIs), who must subscribe to at least two lots. The subscription window closes on June 3, 2025, with allotment expected by June 4, and a tentative listing on the BSE SME platform by June 6, 2025.

Management and Promoters:
The company was founded and is led by promoter and Managing Director Mr. Ashokbhai Babariya, an engineer with over 30 years of entrepreneurial experience and a decade in specialty packaging solutions. He is supported by his brothers, Mr. Mukeshbhai Babariya and Mr. Nitinbhai Babariya, who have been associated with the company since its inception.

Financial Performance:
3B Films has demonstrated steady growth in revenue and profitability in recent years. The revenue from operations for the nine months ended December 31, 2024, stood at ₹5,718.28 Lakh, with fiscal year revenues of ₹7,639.79 Lakh in 2024, ₹7,281.93 Lakh in 2023, and ₹6,807.20 Lakh in 2022. EBITDA figures also reflect an improving trend: ₹1,234.71 Lakh (9M FY25), ₹1,563.90 Lakh (FY24), ₹1,092.66 Lakh (FY23), and ₹866.90 Lakh (FY22). Profit after Tax (PAT) has seen significant improvement, moving from a loss of ₹34.46 Lakh in FY22 to a profit of ₹429.17 Lakh in FY24 and ₹420.19 Lakh in 9M FY25.

Key Ratios:

• Pre-issue EPS (Earnings Per Share) for FY24 is ₹2.02, post-issue EPS is ₹1.73.

• Pre-issue P/E ratio stands at 24.75x, post-issue P/E rises to 28.86x.

• Return on Capital Employed (ROCE) is 8.64%, Return on Equity (ROE) is 14.91%, and Return on Net Worth (RoNW) is 13.88% for FY24.

• The annualized EPS suggests a fair valuation with a P/E ratio around 18.93x.

IPO Utilization:
The company plans to utilize IPO proceeds strategically:

• ₹443.20 Lakh for Capital Expenditure.

• ₹715.00 Lakh for Working Capital requirements.

• ₹443.50 Lakh for general corporate purposes.

• ₹174.30 Lakh to cover fresh offer related expenses.

Grey Market Premium (GMP) and Subscription Status:
Currently, the Grey Market Premium is ₹0, indicating neutral sentiment among grey market participants. The IPO has seen modest subscription uptake, recording 0.34 times subscription by the morning of May 30, 2025. As the grey market trading is unofficial and unregulated, GMP should be interpreted cautiously and primarily for educational purposes.

Allotment Process:
Investors can check their allotment status from June 4, 2025, onwards through the registrar’s website by submitting application details such as application number, PAN, or DP Client ID.

Expert Opinion and Recommendation:
Given the steady financial growth and reasonable valuation metrics, 3B Films represents a growing business in a niche packaging segment. However, the absence of listing gains reflected in the Grey Market Premium and a relatively high post-issue P/E ratio suggest that investors seeking quick returns from listing gains might be disappointed. Hence, industry experts advise caution and recommend avoiding the IPO solely for listing gains, considering it more suitable for long-term investors who believe in the company’s growth story and sector potential.

3B Films’ focus on innovative packaging solutions in an evolving consumer goods landscape positions it well to capitalize on future demand, especially as the packaging industry increasingly demands high-quality, customized films for diverse applications.

The Upcoming IPOs in this week and coming weeks are Victory Electric Vehicles International, Wagons Learning.

The Current active IPO are 3B Films, N R Vandana Tex Industries, Scoda Tubes, Neptune Petrochemicals.

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