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Silicon Rental Solutions Limited IPO

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About :

Silicon Rentals Solutions Limited, an IT equipment outsourcing business founded in 2016, specializes in offering complete IT solutions in India on a rental and returnable basis. The business primarily serves small, medium, and large businesses with laptops, desktop computers, printers, servers, and other peripherals like CCTV cameras, projectors, storage devices, etc.

Depending on the needs of the customer, the company supports businesses by supplying them with the necessary IT items and equipment from top brands for short-term periods of up to one day to longer periods of up to 36 months.

The business offers IT rental services to a customer base that is spread over roughly 16 states and 3 Union Territories in India. A skilled and committed team of engineers is available at Silicon Rentals Solutions to assist and maintain the equipment that is rented out.

The company has branch offices in Pune, New Delhi, and Kolkata in addition to its registered office in Mumbai.

Details on IPO :

The IPO for Silicon Rental Solutions begins on September 28, 2022, and ends on September 30, 2022. The bid period for Silicon Rental Solutions’ IPO is from September 28, 2022, at 10:00 A.M., until September 30, 2022, at 5:00 P.M. On the day of the issue’s conclusion, at 5 PM, UPI Mandate confirmation must be received.

1600 shares make up the Silicon Rental Solutions IPO lot. Retail investors may submit applications for up to 1 lot (1600 shares, or Rs. 124,800).

Objective of the Issue :

1. To fulfill capital expenditure demands for IT equipment

2. Repayment of all or a portion of certain outstanding borrowings obtained by the Company, whether in full or in part.

3. Establishing Corporate Goals

4.  Issue expenses

IPO Review:

  1. SRSL is an IT equipment outsourcing business that offers clients related services.
  1. Both the top and bottom lines have grown.
  1. Superb results for FY22 prompt questions about sustainability.
  1. It looks that the issue is fully priced based on FY22 profits.
  1. Investors with excess cash and those who desire risk may think about making medium- to long-term investments.

Financial Performance : 

In terms of financial performance, SRSL has recorded turnover/net profits for the previous three fiscal years of Rs. 12.28 crore/Rs. 2.16 crore (FY20), Rs. 13.76 crore/Rs. 2.70 crore (FY21), and Rs. 24.68 crore/Rs. 7.47 crore (FY22) (FY22). Thus, both its top and bottom lines have seen substantial growth. Margins reported for the most recent fiscal year give cause for concern about long-term viability.

SRSL has reported average EPS of Rs. 8.46 and average RoNW of 39.00% during the past three fiscal years. Based on its NAV of Rs. 28.40 as of March 31, 2022, and its post-IPO NAV of Rs. 37.13 per share, the issue is valued at a P/BV of 2.75 and a P/BV of 2.10, respectively.

Dividend Policy :

In accordance with the disclosed periods in the offer document, the company has neither declared or paid any dividends. Following the IPO, it will implement a conservative dividend policy based on its financial performance and prospects for the future.

Conclusion :

In a market with intense competition, SRSL competes. According to super profits for FY22, the issue appears to be fully valued. Concerns are raised by higher IPO spending. Risk taker/excess cash An investment may be taken into account by investors with a medium- to long-term outlook.

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