Saraswati Saree Depot IPO: The good and the bad

Published: 09th Aug 2024

By: Value Research

About the company

Saraswati Saree Depot is a women’s ethnic wear wholesaler, primarily dealing in sarees. Serving over 13,000 customers, it operates from its two stores in Kolhapur and Ulhasnagar, Maharashtra.

Total IPO size (Rs cr) 160 Offer for sale (Rs cr) 56 Fresh issue (Rs cr) 104 Price band (Rs) 152-160 Subscription dates August 12-14, 2024 Purpose of issue Working capital requirement

IPO details

M-cap (Rs cr) 634 Net worth (Rs cr) 169 Promoter holding (%) 74.70 Price/earnings ratio (P/E) 21.5 Price/book ratio (P/B) 3.8

Post-IPO

Key financials (Rs cr) 2Y growth p.a. (%) FY24 FY23 FY22   Revenue 5.4 611 602 550   EBIT 39.6 39 33 20   PAT 54.9 30 23 12   Net worth 128.7 65 35 12   Total debt -19.2 44 41 67

Financial history

Ratios 3Y average FY24 FY23 FY22   ROE (%) 84.7 58.9 96.1 99.2   ROCE (%) 36.9 42.6 42.4 25.6   EBIT margin (%) 5.2 6.5 5.5 3.7   Debt-to-equity 2.4 0.7 1.2 5.4

Key ratios

The Good

Saraswati Saree Depot maintains a diversified supply chain with over 900 weavers and suppliers across various states. In FY24, the top 10 suppliers accounted for only 25% of its total purchases.

The bad

The company’s revenue is heavily concentrated, and its operating profit margins are slim. To read why, check the complete risk report in our full story. 

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