Saharsa Electronic Solutions Limited is launching its IPO subscription window from September 26 to September 30, 2024, as it seeks to raise ₹186.15 Crores via a Book Built Issue. The offer includes a Fresh Issue of 60.78 lakh shares worth ₹172 Crores and an Offer for Sale of 5 lakh shares totaling ₹14.15 Crores. With a price band set between ₹269 and ₹283 per equity share, Saharsa presents an attractive opportunity for investors looking to capitalize on a company committed to growth and Environmental, Social, and Governance (ESG) principles.

Saharsa is deeply committed to ESG initiatives. Their strategic focus on sustainability and ethical governance ensures that business decisions reflect their responsibility towards the environment, society, and ethical corporate practices. By embedding ESG principles into their operational and decision-making framework, Saharsa seeks to not only mitigate potential risks but also create long-term value for stakeholders, including employees, investors, and society at large.

Financial Performance:

Saharsa has shown significant financial growth in recent years. In Fiscal 2024, the company reported revenue of ₹10,278.79 Lakhs, compared to ₹1,063.91 Lakhs in Fiscal 2023. The EBITDA surged to ₹3,526.58 Lakhs in FY24 from ₹1,876.88 Lakhs in FY23, while the Profit after Tax (PAT) saw a massive increase from ₹230.55 Lakhs in FY23 to ₹3,262.77 Lakhs in FY24. This impressive growth trajectory reflects Saharsa's robust position in the Electronic System Design and Manufacturing (ESDM) sector.

IPO Details:

Subscription Period: September 26 to September 30, 2024

Issue Size: ₹186.15 Crores

Fresh Issue: ₹172 Crores

Offer for Sale (OFS): ₹14.15 Crores

Price Band: ₹269 to ₹283 per share

Lot Size: 400 shares for retail investors (₹1,13,200), 2 lots (800 shares) for HNIs (₹2,26,400)

Allotment Date: Expected by October 1, 2024

Listing Date: Tentatively set for October 4, 2024 on the NSE SME platform.

ESG and Corporate Governance:

Saharsa's ESG focus is a significant highlight of this IPO. The company has been proactive in promoting sustainability, aiming to reduce its environmental footprint by adopting innovative energy-efficient technologies. They are also committed to social responsibility by supporting local communities and ensuring fair labor practices within their organization. Ethical corporate governance is at the heart of Saharsa’s operations, as they strive to maintain transparency and accountability in all aspects of business.

IPO Grey Market Premium (GMP):

The Grey Market Premium (GMP) for Saharsa IPO ranges between ₹110 and ₹117, indicating a potential listing gain of 25% to 30%. While the GMP reflects market sentiment, it should be noted that these figures are based on informal trading in the unorganized Grey Market, which means actual price discovery happens only after the shares are listed on the exchange.

How to Check Saharsa IPO Allotment:

IPO Allotment Date: October 1, 2024. To check the allotment status:

Visit the IPO allotment status page on the registrar’s website (BIGSHARE SERVICES PRIVATE LIMITED).

Select Saharsa Electronic Solutions IPO from the dropdown.

Enter your application number, PAN, or DP Client ID.

Submit to view the allotment status.

Objectives of the IPO:

The net proceeds from the Fresh Issue will be utilized for the following purposes:

₹6,596.63 Lakhs allocated for Capital Expenditure to install additional plant and machinery at their new manufacturing facility in Bhiwadi, Rajasthan.

₹2,292.58 Lakhs will be invested in their subsidiary, Sahasra Semiconductors Private Limited, to finance capital expenditure.

₹4,000.00 Lakhs allocated towards working capital requirements.

The remaining funds will be used for general corporate purposes.

Leadership and Management:

Saharsa is led by experienced promoters with a strong background in the electronics manufacturing sector:

Amrit Lal Manwani (Promoter & Managing Director) has over 20 years of experience in the Electronic System Design and Manufacturing (ESDM) industry.

Varun Manwani (Promoter & Non-Executive Director) oversees the company’s growth and expansion plans.

Arunima Manwani (Promoter & Whole-Time Director) is responsible for strategic business planning and Research & Development (R&D).

Financial Ratios and Valuation:

At the time of IPO, Saharsa’s shares are offered at a pre-issue EPS of ₹18.05 and a post-issue EPS of ₹13.05. The pre-issue P/E ratio is 15.67x, and the post-issue P/E ratio is 21.68x, compared to the industry P/E of 167.77x. With a Return on Capital Employed (ROCE) of 42.50% and a Return on Equity (ROE) of 54.09% for FY24, Saharsa presents a well-priced opportunity in its sector.

Conclusion:

Saharsa Electronic Solutions Limited IPO offers a compelling investment opportunity, especially for those interested in companies focused on ESG principles and sustainable growth. With a strong financial performance and positive GMP, this IPO may yield both listing gains and long-term investment value. However, as always, investors should consider both market conditions and their own risk tolerance when making investment decisions.

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