Tarsons Products IPO: How good is it?

In our story, Tarsons Products IPO: Information analysis, we read about the key details of the IPO along with important information about the company. Here we will answer some questions about Tarsons Products and evaluate it on parameters like management, financials, valuations etc. IPO questions The company/business 1) Are the company's earnings before tax more than Rs 50 crore in the last 12 months? Yes. In the last 12 months ending June 2021, the company's earnings before tax stood at Rs 116.4 crore. 2) Will the company be able to scale up its business? Yes. The capacity of the company's injection moulding machines depends on the SKU manufactured, mould, raw material, number of cavities and other details. With 1,700 SKUs across 300 product categories and 63 machines and 645 moulds (as of June 30, 2021), the permutations and combinations are humongous. Moreover, it intends to increase its manufacturing capabilities by developing a new facility using the proceeds of the IPO. Through this new facility, it aims to enhance its production capacity in existing products and launch new products as well. 3) Does the company have recognisable brands truly valued by its customers? Yes. In an industry historically dominated by global MNCs, Tarsons Products has won the trust of the scientists' community in India by offering differentiated, user-friendly, consistent quality, and cost-effective products, thereby providing an alternative for high-cost imports. In fact, some of its key products are identified by their brand names. 4) Does the company have high repeat customer usage? Yes. The company uses a distribution-led model to sell its products. It has maintained long-term relationships with its top 10 distributors in, both, domestic and overseas markets. 5) Does the company have a credible moat? Yes. The company's three-year (FY19-21) average gross and EBITDA margins were 73 per cent and 43.1 per cent, respectively. Tarsons Products' broad range of products and its ability to customize products allow its end customers to source most of their product categories from a single brand and enables