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Home » Research
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» Detail Analysis
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Detail Analysis
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Registered Office Address |
Industry House, 5th Floor, 159, Churchgate Reclamation, Mumbai – 400020 |
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Phone |
91-22-22026340 |
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Fax |
91-22-22828865 |
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Email |
fpo@birlashloka.com
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Website |
http://www.birlashloka.com
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Issue Open |
11-Jan-2010 |
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Issue Close |
13-Jan-2010 |
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Issue Size
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6955000 |
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Issue Type |
Book Building |
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Face Value |
Rs.10/- |
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Price Range |
Rs. 45/- to Rs. 50/- |
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Tick Size |
Re.1/- |
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Market Lot |
120 |
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Minimum Order Qty |
120 |
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Listing Stock Exchange |
Mumbai, Calcutta and Ahmedabad |
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Registrar To The Issue |
Bigshare Services Pvt. Ltd.
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Grading |
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Book Running Lead Managers |
Ashika Capital Ltd. |
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Analysis
Company Background - Birla Shloka Edutech Ltd., incorporated in 1992, is a part of Yash Birla Group Company.
- The Company provides end to end solutions in sales and services of various educational products to various educational institutes and government organizations.
- The services provided by the company include ICT (Information and communication Technology) & Multimedia in private schools, ICT solutions in government schools as well as hardware, equipments & software product sale.
- Birla Shloka has setup computer labs, digital classroom solutions and audio visual solutions in schools along with software product “XL@School” which is a curriculum based interactive multimedia software for mathematics and science subjects.
Objects of Issue - Capital expenditure for Turnkey Projects executed by the company under the BOOT model.
- Capital expenditure on up gradation of infrastructure and content development for XL@School.
- Funding the proposed M&A activities.
- To meet the Working Capital requirements.
Funding Requirement | Sl. No. | Particulars | Amount (Rs. Cr) | 1 | Capital expenditure for Turnkey Projects executed by the company under the BOOT model | 15 | 2 | Capital expenditure on up gradation of infrastructure and content development for XL@School | 9.5 | 3 | M&A activity | 4.5 | 4 | Working Capital requirements | 2.13 | 5 | Issue Expenses | 3.03 | 6 | Contingencies | 0.61 | | TOTAL | 34.78 |
Means of Finance | Particulars | Amount (Rs. Cr.) | Amount (Rs.Cr) | Public Offer of Securities | | 34.78 | - Promoters Contribution | 5.00 | | - Issue to Public | 29.78 | | TOTAL | | 34.78 |
Strengths - The company has over 9 years of experience in computer aided education, multimedia and ICT services in IT & E-learning industry. Also, it has in-house expertise in educational content & software development.
- Operating income of the company has increased significantly in FY09 as it jumped by more than 150% to Rs. 104 cr.
Weaknesses - Increasing competition from the organized and the unorganized sector is a threat to its business. In services to school and ICT market there are few big players established and at the same time many local and small players are coming up to grab a share in the local market.
- The industry is subject to high attrition rate.
- Return on Net worth is lower as compared to its peers.
Financial Snapshot - For the FY09, the company reported net profit of Rs 31.45 lakh on total income of Rs 104.03 crore.
- For the period of six months ended on September 2009, it posted net profit of Rs 75.64 lakh on total income of Rs 64.65 crore
- The company has high debt to equity ratio of 1.04
Valuation - Company’s shares are being offered at a price band of Rs. 45 to Rs. 50 per share. Post issue the P/E of the company comes out to 132x at the lower price band and 147x at the upper price band which looks highly expensive.
Peer Analysis (FY09) | Name | Face Value (Rs.) | Sales (Rs.Cr) | EPS (Rs.) | RoNW (%) | P/E (Times) | | Everonn Systems India Ltd. | 10 | 121.38 | 15.77 | 15.4 | 27.19 | | Educomp Solutions Ltd. | 10 | 501.17 | 75.68 | 37 | 10.22 | | Birla Shloka Eductech Ltd. | 10 | 104.1 | 0.34 | 4.41 | 132-147 |
Source: Capital Line
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