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Comrade Appliances IPO consists of fresh issue of 22,78,000 equity shares of face value of ₹10 each. The issue is priced at ₹52 to ₹54 per share, aggregating up to ₹12.30 Crores. The minimum order quantity is 2000 Shares. The IPO opens on May 31, 2023, and closes on Jun 5, 2023.

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Anchor Investors:

• The Company is engaged in the process of manufacturing an extensive array of Air Coolers and Electric Geysers.
• The Company is Original Equipment Manufacturers (OEMs) of Air Coolers and Electric Geysers in India. Designed by the use of quality resources, its product range is appreciated by our customers owing to their lightweight, easy to use, customized size, reasonable price and long-term durability.
• Its manufactures consumer durable goods and assembles a wide array of products and provide end-to-end product solutions. We serve under both original equipment manufacturer (“OEM”) and original design manufacturer (“ODM”) business models. Under the OEM model, it manufactures and supplies products basis designs developed by it customers, who then further distribute these products under their own brands.
• Under the ODM model, in addition to manufacturing, Comrade Appliances Limited conceptualizes and designs the products which are then marketed to customers under their brands.
• The current product portfolio of consumer goods includes (I) Air Coolers; (ii) Electric Geysers.
• It offers innovative solutions to its customers, which include leading international and national consumer brands. Its comprehensive solution suite includes global sourcing, fabrication of components and parts, captive manufacturing and assembly, quality testing, packaging and logistics support, which enables us to partner with leading consumer goods brands in India. its key customers include leading brands in consumer durables.
• It has over 5 years of experience in manufacturing sector. Since inception, it has expanded its product portfolio, customer base and gained technological expertise in designing and manufacturing of its products.
• Comrade Appliances Limited was originally incorporated on March 22, 2017, as a Private Limited Company as “Comrade Appliances Private Limited”
• Company has four departments which includes 1) Production Department, 2) Moulding Department, 3) Administration Department 4) Logistics Department. The Promoters of company are M/s Troupe Technologies Private Limited, Mr. Khursheed Alam and Mr. Mehboob Alam.

Hemant Surgical Industries IPO: Financials

Salient Points

• The Promoter and Promoter Group shareholding which is collectively 100.00% of the pre- Offer paid-up Share Capital of the Company. Post IPO it shall be 69.74%.
• Top 5 customers account for 84.48% of sales.
• The proceeds from the IPO will be used for the following purposes:
  • Working Capital Requirements: ₹9.00 Crores
  • General Corporate Purposes: ₹3.30 Crores

• Company is engaged in the business of manufacturing of Air coolers and Electric Geysers. Maximum revenue comes from air cooler business. The air cooler business experience significant increase in sales during the summer seasons i.e. from March to June every year. Although our Electric Geysers is a product which has a sale all around the year but our company is still dependent on sales of air cooler as it is the established business.
• Company is Original Equipment Manufacturers (OEMs) of Air Coolers and Electric Geysers in India. In recent years, consumer companies/brands have increasingly outsourced the manufacturing of their products to OEM players.
• While OEM sales continue to be a major source of revenue, Comrade Appliances plans to gradually expand share of the ODM model of manufacturing. As an ODM, it can control the entire manufacturing cycle of a product from the initial stage of designing and are responsible for all the aspects of manufacturing, including planning and sourcing of raw materials and components. Under ODM, it sells products to companies who in turn distribute these products under their own brand to end users, however, warranties with respect to defects in raw materials and workmanship affecting normal use of products are provided by it. The ODM model of business requires additional investment in R&D as well as working capital but provides higher margins as compared to the OEM model. Comrade Appliances strategy is to move towards the ODM model is to service all major customer requirements across the industry and product verticals.
• Company mainly supplies to OEMS but its own brands are also present on ecommerce sites.

• There is an outstanding tax litigation of Rs. 4.69 Lacs.
• The company sales have remained stagnant. It has reported higher profits in this year mainly due to lower expenses on Raw Materials. The jump in profit in Fy23 is significant and raises some eyebrows.
• Comrade Appliances Limited has availed of secured Loans from Bank of India, Canara Bank, HDFC Bank, State Bank of India, SIDBI, PNB and unsecured loans from clutch of NBFCs like Bajaj Finance, Fullerton India Loan, Aditya Birla etc.
• The company has shown Dixon Technologies (India) Limited and PG Electroplast Limited as its peers which does not make any sense.
• Its PE ratio is 25x (fy23 earnings). There has been a big jump in profit in Fy23.
• I have not made up my mind to apply in Comrade Appliances IPO as there is a significant jump in profit in last year without commensurate increase in revenues. It can attract some fancy if market believes in its ODM theme being projected. I may still apply at last moment if there is good response.
• SME IPO in general are more volatile and risky.
• The lead book running manager is Gretex Corporate Services Private Limited. The IPOs lead managed by them include names like Innokaiz India Limited, Retina Paints Limited, Reetech International Cargo and Courier Ltd, Sudarshan Pharma Industries Ltd, Steelman Telecom Limited, Markolines Traffic Controls Limited etc.
• GMP as reported on social media has been around Rs. 10-15.
• Please do your own diligence as SME IPOs are more volatile and risky than mainboard IPOs and need more funds.

• Standard disclaimer: I am not a SEBI registered analyst and above analysis is for educational purpose only. Iam a postgraduate in engineering & Management . Also Certified in 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.