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S Chand and Company IPO: A long term investor can opt this issue - IndiaNotes.com
S Chand and Company IPO: A long term investor can opt this issue
SMC | Published: 25 Apr, 2017  | Source : IndiaNotes.com

About the company


S Chand And Company Limited operates as an education content company in India. The company develops and delivers content, solutions, and services in the education K-12, higher education, and early learning segments. It is involved in publishing, printing, sale, purchase, export, and import of various books and other literary work. S Chand And Company Ltd offers 53 consumer brands across knowledge products and services including S.Chand, Vikas, Madhubun, Saraswati, Destination Success and Ignitor. The company also exports its printed and digital content to Asia, the Middle East, Africa, and internationally.


Objects of the Issue


- ŸRepayment of loans availed by the Company and one of its Subsidiaries, EPHL, which were utilized towards funding the acquisition of Chhaya


- ŸRepayment / prepayment, in full or in part, of certain loans availed of by the Company and certain of its Subsidiaries, VPHPLand NSHPL


Valuation


Considering the P/Bv valuation , on the higher end of the price band of Rs. 670, the stock is priced at P/B ratio of 3.93x on the pre issue book value of Rs.170.60 and on the post issue book value of Rs. 240.42 the P/B comes out to 2.79x.Considering the P/Bv valuation , on the lower end of the price band of Rs. 660, the stock is priced at P/B ratio of 3.87x on the pre issue book value of Rs.170.60and on the post issue book value of Rs. 240.42 the P/B comes out to 2.75x.


Outlook


The company delivers content, solutions and services across the education lifecycle through its K-12, higher education and early learning segments with a strong presence in the CBSE/ICSE affiliated schools and increasing presence in the state board affiliated schools across India. The sales seasonality in its K 12 segment materially affects its operating revenue, margins and cash flows from quarter to quarter. Accordingly, as per the management estimates, its operating revenues and margins during the first three Fiscal quarters have typically been lower, compared to the fourth Fiscal quarter. Considering the seasonality of the business, an investor with long term prospect may opt the issue.

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About SMC
SMC Research, founded in 1990, is India’s leading share and stock broker, provides a wide range of financial services and investment solutions. A blend of extensive experience, diverse talent and client focus has made us the 4th largest broking house in India(Source: Dun and Bradstreet, 2008). Over the years, SMC has expanded its operations domestically as well as internationally. Existing network includes regional offices at Mumbai, Kolkata, Chennai, Cochin, Ahmedabad, Jaipur, Hyderabad, Bangalore plus a growing network of 2100+ offices spread across 425 cities/towns in India.


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Disclaimer: The author has taken due care and caution to compile and analyse the data. The opinions expressed above are only the views of the author, and not a recommendation to buy or sell. Neither the author nor IndiaNotes.com accept any liability whatsoever arising from the use of any of the above contents.