IPO Update: Dynemic Products Ltd.

Average Issue : Apply for listing Gains
Dynemic products has entered the capital markets with a intial public offer of 44.21 Lac shares at a fixed price of Rs.35 per share (Rs. 25 premium on a face value of Rs.10) for expansion of its existing facilities. Investment Guru rates the issue as an average issue and recommends investors to apply only with a view to take advantage of the listing gains on account of ongoing IPO Boom.

Dynemic is into manufacturing of food colours (dyes & pigment) which has applications in food industry, beverages,drugs and alcohol. The company has a popular product named "tartrazine".

Major share of Revenues comes from export earnings.

For FY05 the company clocked sales of Rs. 27.75 crores and a net profit of Rs. 2 Crores. For first 5 months of FY06, the company has clocked a turnover of Rs. 11.45 crores and a net profit of Rs. 1.2 Crores.

At the offer price of Rs. 35 and the weighted average EPS of 3.5, the offer comes at a P/E multiple of 10.14 This looks reasonably given the P/E of its peer in the range of 6-37.

Return on net worth(weighted average ) comes to 20.59% and the post issue Net Asset value will be Rs. 21.86

Issue Opens : 18-Jan-2006
Issue Closes : 25-Jan-2006
Registrar: Big Share services Pvt. Ltd.

4 comments:

Manoj Kr. said...

Hi rajesh, I have 1 Lac to invest in IPO. Shall I invest part of it in Dynemic or invest in othet IPO's ? Pl. Guide.

Anonymous said...

manoj, you can apply for Radio Mirchi IPO and Guj. state petronet IPO instead of this one.

Shankar said...

hi, one peer you can compare this issue with is Vidhi Dyestuff. The stock is trading around rupee 4.1 (FV=1 rupee)and gives a PAT of around 4 crs. The Q1 and Q2 reports have been a disappointment. So perhaps it's time to think if investing in this company is "good prudent business". Ask me, DONT INVEST !!!

- Shankar
small2big.blogspot.com

Anonymous said...

Hi Rajesh,
I had applied for Dynemics in the IPO and got 150 shares on allotment. can u tell me should i book loss and exit or till when can i wait to get the issue price atleast.