Jyothy Laboratories IPO opened for subscription on Thursday. The share with face value of Rs 5 each is offered at a price band between Rs 620 and Rs 690 per equity share. After lacklustre first day, second day collection was 0.03 times.
Details:
Jyothi Laboratories Limited IPO Information: | |||
Public Issue Open | 22-27 Nov 2007 | Public Issue Type | 100% Book Building |
Public Issue Size | 4,430,260 shares | Listing At | BSE, NSE |
Face Value | Rs. 5 | Public Issue Price | Rs. 620/- to Rs. 690/- |
Market Lot | 10 Shares | ||
Lead Manager(s) | Kotak Mahindra Enam Financial | Registrar | Intime Spectrum Registry Ltd |
As per India Infoline, Jyothy Labs well placed for healthy growth. As per India Infoline report:
Jyothy Laboratories (JLL) is an FMCG company making a range of branded products, including fabric whiteners, mosquito repellents, dish-washing soaps, soaps and incense. Its key brands are Ujala, Maxo, Exo, Jeeva and Maya.
Investment summary
* Ujala is a well-known brand of fabric whitener, with dominant market share of approximately 72% in the category
* Local presence and wide distribution reach
* Targets the rural market
* Entering into new joint-venture initiatives
Risks and concerns
* Heavily depend on two biggest brands, Ujala and Maxo which contribute 43.6% and 35.4% of its total sales respectively (as on 30 June 2007).
* Dependence on outsourced production through third parties. Any disputes or disagreements may affect their business.
* The company is susceptible to seasonal variations in demand for its products.
Valuations attractive in comparison to the peer group
At the issue price of Rs 620-690, JLL commands an inexpensive P/E (on relative basis) of 18.6x-20.7x based on FY07 EPS of Rs 33.3. The price/book ratio of 3.4x at Rs 690 is also at steep discount to peers. The company is well-placed for healthy growth, given its well-established brand equity, leadership in the fabric whitener segment and strategic alliances. We recommend to Subscribe in the issue.
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