Vdeal System Ltd., a comprehensive solution provider in the field of Electrical Panels, Industrial Automation, Process Instrumentation, and Industrial IoT (I-4), is set to launch its Initial Public Offering (IPO), amounting to ₹18.07 crores. With over 20 years of experience in the industry, Vdeal System has built a solid reputation for delivering high-quality automation solutions to its valued customers across India. The company's IPO, a Fixed Price Issue, will consist of a Fresh Issue of 16.14 Lakh Shares, aiming to raise capital to further strengthen its operations and financial position.

Key IPO Details

The Vdeal IPO subscription period is scheduled to open on August 27, 2024, and close on August 29, 2024. Investors can anticipate the allotment to be finalized on or around August 30, 2024, with the shares expected to be listed on the NSE SME platform by September 03, 2024. The share price for the IPO is set at ₹112 per equity share, with a minimum lot size of 1,200 shares. Retail investors are required to invest a minimum of ₹134,400, while High-Net-Worth Individuals (HNIs) must invest in at least 2 lots (2,400 shares), amounting to ₹268,800.

The book-running lead manager for this IPO is Affinity Global Capital Market Private Limited, with CAMEO CORPORATE SERVICES LIMITED acting as the registrar. M/s Black Fox Financial Private Limited will serve as the Market Maker for this IPO.

Grey Market Premium (GMP) and Listing Expectations

As per current market sentiments, the Grey Market Premium (GMP) for Vdeal System Ltd.'s IPO is anticipated to be in the range of ₹75 to ₹80. This premium is based on the company’s strong financial performance and robust subscription status. Although Grey Market Premiums are not officially recognized and should be taken with caution, they do provide a glimpse into the potential listing gains. In Vdeal’s case, the GMP suggests a potential listing gain of 70% - 75%, making it an attractive proposition for investors looking for short-term gains.

How to Check Vdeal IPO Allotment Status

Investors looking to check their Vdeal System IPO allotment status can do so on the registrar's website once the allotment is finalized on August 30, 2024. Here’s how you can check the allotment status:

Navigate to the IPO allotment status page on the registrar's website.

Select "Vdeal System Limited IPO" from the dropdown list of IPOs.

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

Submit the details to view your allotment status.

Utilization of IPO Proceeds

The funds raised through this IPO will be utilized by Vdeal System Ltd. for the following purposes:

Working Capital Requirements:
Approximately ₹702.58 Lakhs will be allocated to meet the company’s working capital needs, ensuring smooth operational flow and the ability to meet increasing demand.

Loan Repayment:
₹463.95 Lakhs will be directed towards the prepayment and repayment of certain secured and unsecured loans, reducing the company’s debt burden.

General Corporate Purpose:
A sum of ₹370.00 Lakhs will be set aside for general corporate purposes, providing flexibility to address various business needs and strategies.

Offer Expenses:
A portion of the proceeds will also cover the costs associated with the IPO process.

Company Background and Financial Overview

Guided by its promoters, Mr. Dhiraj Kochar and Mrs. Tapaswini Panda, Vdeal System Ltd. has established itself as a leader in the Industrial Automation and IoT sector. The company’s financial performance over the years has been commendable, reflecting its growing market presence and operational efficiency.

Revenue has grown from ₹1,623.96 Lakhs in FY22 to ₹2,075.41 Lakhs in FY23, and further to ₹2,625.08 Lakhs in FY24. Similarly, EBITDA has surged from ₹139.65 Lakhs in FY22 to ₹536.03 Lakhs in FY24. The company’s Profit After Tax (PAT) has also shown a positive trajectory, increasing from ₹23.10 Lakhs in FY22 to ₹311.38 Lakhs in FY24.

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For investors considering the Vdeal System IPO, the company’s pre-issue Earnings Per Share (EPS) stands at ₹9.50, while the post-issue EPS is projected at ₹6.36. The pre-issue Price-to-Earnings (P/E) ratio is 11.78x, and the post-issue P/E ratio is 17.61x, which is favorable compared to the industry P/E ratio of 68.06x. The company's Return on Capital Employed (ROCE) for FY24 is 32.83%, and Return on Equity (ROE) is 49.52%, indicating efficient management and profitable operations.

Investment Recommendation

Given the company’s strong financial growth, favorable valuation metrics, and potential for substantial listing gains, the Vdeal System IPO presents a compelling opportunity for both retail investors and High-Net-Worth Individuals (HNIs). The company’s consistent performance, coupled with its ambitious growth plans, makes it an attractive option for those looking to capitalize on the booming industrial automation and IoT sector in India.

Investors are encouraged to consider applying for the Vdeal System Ltd. IPO not only for potential listing gains but also for long-term investment purposes. The company's focus on innovation, quality, and customer satisfaction, along with its experienced leadership, positions it well for sustained growth in the years to come.

Conclusion

As Vdeal System Ltd. prepares to go public, the IPO offers a unique opportunity to invest in a company that is well-positioned within the Electrical Panels, Industrial Automation, and IoT sectors. With its robust financials, strategic use of IPO proceeds, and the backing of experienced promoters, Vdeal System Ltd. is poised for significant growth, making this IPO a promising investment opportunity for both short-term and long-term gains.

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