ICL Dairy IPO - Grey Market, GMP & Reviews

IPO Details

About ICL Organic Dairy Products Ltd

ICL Group was established as a small infra firm in Bareilly, by Mr. R.K. Gola, a young entrepreneur with an exceptional foresight, in 2008. Over the years, the group has undertaken many arduous projects and accumulated skills, know-how. The group has gathered hands-on experience by participating rigorously in every challenge faced while building the ICL Group. During this time, the group has accumulated vision, pragmatism and has emerged as a butterfly out of its cocoon. Currently, we operate in 4 states where procurement, processing and packaging of milk and milk products are carried out. Our products are available for purchase in 9 states. We have 11 processing plants and 65 milk chilling centers.

ICL Group was established as a small infra firm in Bareilly, by Mr. R.K. Gola, a young entrepreneur with an exceptional foresight, in 2008. Over the years, the group has undertaken many arduous projects and accumulated skills, know-how. The group has gathered hands-on experience by participating rigorously in every challenge faced while building the ICL Group. During this time, the group has accumulated vision, pragmatism and has emerged as a butterfly out of its cocoon. The group is serving & providing their services not only in terms of earning revenue but discharging their social obligations through Image Sewa Sansthan. The group instills corporate social responsibility in their employees by providing help to the poor section as well as physically disabled persons. Today under the ICL Group umbrella, there are multiple domains such as Finance, Insurance, Multi Product Trading, High Tech Dairy Products and Online Marketplace. The ambitious cold chain project is also in the fray. These domains serve to show the variety of work undertaken by the group as it has laboriously climbed the ladder to corporate success. The group works relentlessly to provide utmost client/customer satisfaction. This is enunciated in the motto- “As We Make Our Customers the Hero of Our Story”. Our emphasis is on clear communication and follow-through procedures to ensure that the client’s objectives are top priority in the planning and execution of all our processes. This shows our acumen and our approachability when it comes to our clients. Responsiveness and product and service expertise are attributes which set this group apart from other companies.

Initially the group started their functioning with a small capital of Rs. 2 lakhs and a single-room office. Today, the Company has huge marketing network, a solid capital base and sound infrastructure in a span of a decade. The company has been thriving and has now established ICL as a brand particularly in North India. The company is striving to reach the zenith in the field of suiting & shirting and FMCG products like ICL Fabrics, ICL Tea, ICL spices. The company is about to add a few more products to their already impressive roster. Our major revenue comes from fabric which is almost 50% of the total revenue & rest revenue comes from other products. ICL Brand is very popular particularly in the mid towns of North India.

Presently all multinational companies who are dealing in FMGC & Fabric are looking towards the mid-town of the country which is an untouched huge market. But the promoter of the ICL Group anticipated this fact that the future market is in the mid towns, much before anyone else. That is why they targeted only mid-towns instead of entering in metropolitan cities. As a result, the growth rate of ICL in comparison to others is much higher. Forward planning and circumspection resulted in a favorable result for the company, which speaks volumes about the potential of the group. The group began with two directors- Mr. R.K. Gola & Mr. A.K. Gola and after a year of success and within a span of less than a decade the group consists today of more than 750+ skilled and semi- skilled employees who are experts in their respective fields such as Marketing, Finance, Administration, IT and others.

The management team proactively gathers feedback, identifies changes in business environment, reviews work processes and communicates key learning points and company policy to all staff at regular meetings. This arms us with the fortitude to take on all new challenges.

Company Promoters

Mr. Roop Kishore Gola and Mr. Avadhesh Kumar Gola are the promoters of the company.

Issue Details

To part finance its plans for working capital needs (Rs. 3.48 cr.) and general corpus fund needs (Rs. 0.25 cr.), IODPL is coming out with a maiden IPO of 2040000 equity shares of Rs. 10 each at a fixed price of Rs. 20 per share to mobilize Rs. 4.08 cr. The issue opens for subscription on 31.01.20 and will close on 04.02.20. Minimum application is to be made for 6000 shares and in multiples thereon, thereafter. This issue is solely lead managed by Finshore Management Services Ltd while Cameo Corporate Services Ltd. is the registrar to the issue. Beeline Broking Ltd. is the market maker for this issue. Post allotment, shares will be listed on BSE SME. The issue constitutes 33.99% of the post issue paid-up equity capital. The company is spending Rs. 0.35 cr. for this issue process.

Having issued initial equity at par, IODPL converted/issued further equity shares at a fix price of Rs. 20 per share between March 2019 and November 2019. It has also issued bonus shares in the ratio of 1 share for every 2 shares held in July 2019. The average cost of acquisition of shares by the promoters is Rs. 15.34 and Rs. 17.23 per share.

Post issue IODPL's current paid-up equity capital of Rs. 3.96 cr. will stand enhanced to Rs. 6.00 cr. The company is mulling market cap of Rs. 12.00 cr. with this issue.

Company Financials

For the last three fiscals, IODPL has posted turnover/net profits of Rs. 2.53 cr. / Rs. 0.05 cr. (FY17), Rs. 12.07 cr. / Rs. 0.35 cr. (FY18) and Rs. 15.73 cr. / Rs. 0.28 cr. (FY19). For the first four months ended on 31.07.19 of FY20, it has earned a net profit of Rs. 0.05 cr. on a turnover of Rs. 2.23 cr.

For the last three fiscals, IODPL has posted an average EPS of Rs. 85.30 and an average RoNW of 39.25%. This data is based on old equity base as on 31.07.19. The issue is priced at a P/BV of 1.12 on the basis of its NAV of Rs. 17.79 as on 31.07.19 and at a P/BV of 1.03 based on post issue NAV of Rs. 19.38.

While its top line has shown growth, its bottom line witnessed inconsistency. It is in the high volume/low margin business segment with tough competition from many big players. This industry is highly fragmented.

If we annualize the latest earnings and attribute it on fully diluted equity post issue, then asking price is at a P/E of around 80. Thus the issue is aggressively priced against industry average of 29.5.

Company Financials

Subscription Details

Allotment Status

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IPO Allotment Status