Standard Glass Lining IPO - Price Band, Issue Details, Allotment, Listing Date, Financials And More: DRChoksey

Deven Choksey Research Report

Standard Glass Lining Technology Ltd. will launch its initial public offering on January 06 and the offer closes for subscription on Jan. 08. A specialized engineering equipment manufacturer for the pharmaceutical and chemical sectors in India has fixed the price band in the range of Rs 133-140 per share.

The Rs 419.05 crore IPO comprises of a fresh issue of shares worth up to Rs 219 crore and an offer-for-sale of 1.43 crore shares aggregating up to Rs 200.05 crore. The minimum order lot for bidding is 107 and in its multiples thereafter.

The allotment for the Standard Glass Lining Technology IPO is expected to be finalized on Jan. 09.

Following the public issue, shares of Standard Glass Lining Technology will be listed on the NSE and the BSE on Jan. 13.

Outlook and Valuation:

Standard Glass Lining Technology distinguishes itself as a one-stop solution for clients by providing turnkey solutions in addition to equipment supply. Over the years, the company has delivered strong financial performance, showcasing consistent revenue growth and stable margins. Looking ahead, the company plans to enhance its SGL Unit, by increasing capacity from 1,609 to 1,877 units.

Furthermore, it intends to invest Rs 300 million from IPO proceeds into its material subsidiary, S2 Engineering Industry Pvt. Ltd., to upgrade facilities with advanced machinery and expand capacity from 1,962 to 2,172 units.

While the company has primarily focused on the domestic market and export contributing just 0.4% to revenue in FY24, it aims 12– 15% export revenue in FY25 and a 25% YoY revenue growth.

From a valuation perspective, the company, with a P/E of 47 times, enterprise value/Ebitda of 30 times, return on equity and return on capital employed of 21% and 23% respectively, is considered fairly valued compared to its peers.

Overall, the company is a financially robust and growing with a unique business model, strategic partnerships, and ambitious expansion plans. Positioned to capitalise on the growth of India’s pharmaceutical, chemical, and allied industries. Hence, We assign a “Subscribe” rating.

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