Aztec Fluids & Machinery Limited provides a quality-assured assortment of Printers, Printer consumables, and Printer Spares to a diverse range of industries. Aztec Fluids & Machinery IPO is set to raise Rs 24.12 crores. The issue is entirely a fresh issue of 36 lakh shares

About Aztec Fluids & Machinery IPO:

• Established in 2010, they provide coding and marking solutions to a diverse range of industries such as personal care, food & beverages, pharmaceuticals, construction materials, cables, wires & pipes, metals, automotive & electronics, agrochemicals, chemicals & petrochemicals etc.
• The product portfolio includes (i) printers such as continuous inkjet printers (CIJ), Thermal Transfer Over printers (TTO), Drop on demand printers (DOD), NIJ printers (i.e. piezoelectric printers) and laser printers (ii) printer inks and (iii) printer consumable items i.e. makeup and cleaning solvents.
• Since 2015, they are an exclusive distributor of Lead Tech (Zhuhai) Electronic Co. Ltd., China for CIJ Printers, TTO Printers and a range of associated equipment and accessories for various countries such as India, Sri Lanka, Nepal, Bhutan, Bangladesh, Kenya and Nigeria.
• The other type of printers such as DOD and NIJ are imported by them from other foreign suppliers.
• They procure inks from Fluidtech Corp (“Fluidtech”), a partnership firm of Promoters,
• They also have a manufacturing setup at Vatva, Ahmedabad from where they manufacture printer consumable items i.e. makeup and cleaning solvents as well as inks as per requirement basis.
• Their registered office is in Ahmedabad. A new facility in Kheda district will be dedicated to printer assembling, configuring, testing, and other relevant activities associated with printer.
• Existing Promoters, Mr. Pulin Kumudchandra Vaidhya, Mrs. Amisha Pulin Vaidhya and Mr. Kumudchandra Bhagwandas Vaidya has around 22 years, 14 years and 10 years of experience respectively in this industry.

Financials: Aztec Fluids & Machinery IPO

Anchors: Aztec Fluids & Machinery IPO

Aztec Fluids & Machinery IPO: Salient Points

• Their range of products allows our customers to print vital variable information like batch number, date, price, logo, brand, size, barcodes, promotional codes, meter marks, special marks etc. on the products such as steel tubes, aluminum panels, G.I. sheets, laminates, glass, PVC, plywood, woven sac, corrugated boxes, plastics and packing materials.
• The Net Proceeds are proposed to be utilized in the manner set forth below:

• They generate a significant portion of revenue from key product i.e. printers which contributed to 31.21% of our total revenue in Fiscal 2023 amounting to ₹ 1694.90 lakhs and 33.54% of total revenue for the nine months period ending December 31, 2023 amounting to ₹ 1707.48 lakhs.

• Amongst the printers they sell, continuous inkjet printers (“CIJ printers”) contributes to most of the revenue, for instance, out of the total 867 printers sold by them in the nine months period Apr.’23 to Dec.’23, 792 printers were continuous inkjet printers.
• Product mix in terms of revenue contribution in the periods indicated

• Promoter, Mr. Pulin Kumudchandra Vaidhya has been awarded with Vibrant leadership award for excellence in manufacturing & export of CIJ inks & printers in 2020 and pioneers of Gujarat award in 2023.
• Company’s customers
• Thwy compete with a number of other players which are engaged in the printers, inks and consumable items industry. Some of our significant competitors in this segment includes Control Print Ltd., Videojet Technologies, Domino and Markem Imaje.
• Peers

• They compete with a number of other players which are engaged in the printers, inks and consumable items industry. Some significant competitors in this segment includes Control Print Ltd., Videojet Technologies, Domino and Markem Imaje.
• Companies such as Astral pipes, Prince pipes, Ashirvad Pipes, Makson Pharmaceuticals, Sentini Flopipes and Best Ink and Solutions have been our customers for the last five fiscals
• Company executed a term sheet, dated November 6^th, 2023, pertaining to the acquisition of all the equity shares of Jet Inks Private Limited (“Jet Inks”), which is a Chennai based company, engaged in the business of manufacturing of inks and also deals in printers, consumables and spares.
• Company proposes to utilise an estimated amount of ₹ 1400.00 lakhs out of the issue proceeds towards acquisition of Jet Inks Private Limited.
• For the nine months period ended Dec.’23 and Fiscal 2023, they have served over 1200 and 1100 customers respectively.
• They have sold their products in India and several other countries across the globe which include China, Malaysia, African countries such as Nigeria, Rwanda, Mozambique Kenya Ghana, Uganda, Zambia and Middle East countries such as Saudi Arabia and Kingdom of Bahrain.
• Exports though miniscule have been growing and form 5.5% of the revenue now.
• Aztec Fluids & Machinery IPO is coming at a PE ratio of 27.8x (FY23 Earnings) and 15.2x (fy24 annualized earnings)
• I intend to apply in Aztec Fluids & Machinery IPO subject to availability of funds. Peer Control Print has an enviable track record and is much bigger in size with better margins. However valuations in this case are OK and not exorbitantly priced.
• GMP as reported on social media has been Rs. 30.
• Hem securities is the Lead Manager to the issue. The IPOs lead managed by them have given a good return to the investors. These include names like Amkay Products Limited, Aspire & Innovative Advertising Limited, Blue Pebble Limited, Enfuse Solutions, Sona Machinery Limited, Harshdeep Hortico Limited, Megatherm Induction Limited, New Swan Multitech Limited, Shri Balaji Valve Components Limited, Shanti Spintex, SJ Logistics,Siyaram Recycling Industries Limited, Deepak Chemtex Limited, Paragon Fine And Specialty Chemicals, E Factor Experiences Limited, Arabian Petroleum Limited, ,Saakshi Medtech and Panels Limited, Kahan Packaging Limited, Asarfi Hospital Limited, Kaka Industries, Green Chef, Vasa Denticity, Chaman Mettalics, Hemant Surgicals, Labelkraft, Concord Control Systems Limited, Earthstahl & Alloys Limited, Silicon Rental Solutions Limited, Krishna Defence and Allied Industries, Prevest Denpro Limited etc.
• SME IPOs are quite volatile and new retail investors need to exercise considerable caution in my view.
• This post is exploratory and educational purposes only. Please do your own diligence before investing in SME IPOs like this.
• Standard disclaimer: I am not a SEBI registered analyst and above analysis is for educational purpose only. Iam a postgraduate in engineering & Management . I have in the past cleared some exams like NISM-Series-V-A: Mutual Fund Distributors Certification, NISM-Series-X-A: Investment Adviser (Level 1) Certification and NISM-Series-X-B: Investment Adviser (Level 2) Examination. This post is my view on the subject matter and is only academic and exploratory in nature. It is not meant to influence investment decisions of investors. I may have bias/vested interest in covered Stock/Mutual Funds/NCD etc. due to my own investment or leaning. Further my understanding of the areas on which I write may be imperfect or incomplete and data could be wrong due to limited time and resources at my disposal. Do check the data from company’s RHP and exchanges before making any decision. Please do your own due diligence as stock market/MF investments have high degree of inherent risk.