The C2C Advanced Systems IPO is open for subscription from November 22 to November 26, 2024 and is set to list on the NSE SME on November 29, 2024. With an IPO size of ₹94.68 Crore, the company is issuing 43.83 Lakh shares at a price range of ₹214 to ₹216 per equity share. The market capitalization at the upper price band of ₹216 per share stands at ₹359.44 Crore. The lot size for this IPO is 600 shares, requiring a minimum investment of ₹1,29,600 for retail investors and ₹2,59,200 for HNI investors.

Grey Market Premium (GMP) and Subscription Status

As of November 26, 2024, the C2C Advanced Systems IPO has witnessed a 97.92x subscription on its final day, showcasing immense demand from investors. However, the grey market premium (GMP) for the IPO is reported at ₹0, indicating no expected premium on listing. This suggests that the IPO might not generate immediate listing gains.

Financial Overview

C2C Advanced Systems has shown impressive revenue growth in recent years, with revenues from operations growing from ₹34.79 Lakhs in FY2022 to ₹4,129.82 Lakhs in FY2024. The company has also shown significant EBITDA growth from a loss of ₹208.30 Lakhs in FY2022 to ₹1,856.45 Lakhs in FY2024, reflecting improved operational efficiency. Profit after Tax (PAT) has similarly improved, going from a loss of ₹238.21 Lakhs in FY2022 to a profit of ₹1,227.69 Lakhs in FY2024.

The P/E ratio of the company stands at 13.50x pre-issue and 29.30x post-issue, which is significantly lower than the industry average of 116.89x. While this might seem attractive, investors should consider the company's relatively small size and its reliance on capital expenditures for future growth. The Return on Equity (RoE) for FY24 is 16.21%, a positive indicator but not strong enough to suggest significant outperformance compared to larger, more established players in the market.

The Current active IPO is Rajputana Biodiesel, Rajesh Power Services, C2C Advanced System, Enviro Infra Engineers and Lomosaic India.

IPO Objectives and Utilization of Funds

The funds raised through the fresh issue will be allocated as follows:

• ₹1,473.10 Lakhs for capital expenditure, including upgrades to the Experience Centre in Bengaluru and setting up a new centre in Dubai.
• ₹458 Lakhs for fit-outs at new premises in both Bengaluru and Dubai.
• ₹160 Lakhs for security deposits at the new premises in Bengaluru.
• ₹4,600 Lakhs to fund the company's working capital needs.
• The remaining funds will be used for general corporate purposes.

IPO Review and Investment Recommendation

Despite the company's strong revenue growth and improving financial metrics, the C2C Advanced Systems IPO appears to be fairly priced with the post-issue P/E ratio standing at 29.30x. Given the lack of grey market premium, the IPO may not yield immediate listing gains, and its relatively small market size could limit long-term growth potential compared to larger players in the industry. Investors should approach this IPO cautiously and consider avoiding it for both listing gains and long-term investments.

The Upcoming IPOs in this week and coming weeks are Apex Ecotech, Abha Power and Steel, Agarwal Toughened, Ganesh Infraworld, Suraksha Diagnostic, Property Share REIT, Rosmerta Digital, Avanse Financial and Nisus Finance.

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