Data Patterns (India) Limited IPO | The Metro Brands IPO Details & Review

Data Patterns (India) Limited IPO:

Data Patterns (India) Limited is one of the fastest-growing companies in the defense and Aerospace electronics sector in India. The company offers products of defense and aerospace platforms-space, air, land, and sea. The company has been established in 1985 and its core skills in the design & development of electronic hardware, software, firmware, mechanical, product prototype, manufacturing, functional testing and validation, environment testing & verification, and engineering services. 

The company’s manufacturing facility is situated in Chennai, which has a facility for design, manufacturing, and life cycle support of high-reliability electronics systems used in defense and aerospace. The company works closely with the defense PSU like Hindustan Aeronautics Ltd. and Bharat Electronics Ltd., also government organizations involved in defense & space research such as DRDO. Data Patterns has decided to launch its maiden IPO on 14th December. 

Here are things to know before subscribing to the public issue:

Company Financials: 

The Company recorded the highest growth between FY19 to FY21. The revenue of the company is ₹131 crores in FY19 which was increased to ₹156 crores in FY20 and the growth is 19%. The revenue of FY21 has come to ₹24 crores and the growth is 43.5%.

Promoters & Management: 

Mr. Srinivasgopalan Rangarajan is the chairman & managing director of the company and has been associated with the company since 1985. Rekha Murthy Rangarajan is the whole-time director of the company, associated with since established the company.

Mathew Cyriac is the nominee director and Sabita Rao, Vadlamani Venkata Rama Sastry, Sowmyan Ramakrishnan, and Prasad Raghava Menon are the non-executive directors of the company.

Key Risk: 

Dependency of a limited number of customers like DRDO, Défense PSU such as MoD, BrahMos, and Indian government space.

The business of the company is largely dependent on contracts from the government of India and defense public sector undertaking and government organizations involved in space research. Any significant change in government policies for defense-related projects will slow the growth.

Any failure to comply with quality standards.

Insufficient cash flow from operations and inability to borrow the funds to meet the working capital requirements.

Strength:

Data Patterns (India) Limited is one of the Integrated and strategic defense & aerospace electronics solution provider companies, which is well-positioned to benefit to make in India opportunity.

Focused on in-house development and production capabilities with design and development efforts.

A modern certified manufacturing facility of international standards.

Consistent track record of profitable growth due to scalable business model & marquee customers in defense.

Data Patterns IPO Details:

The IPO comprises a fresh issue of ₹240 crores and an offer for sale of 59, 52,550 shares by selling promotors. The issue will bring in the company ₹588.22 crores. The issue is 50% reserved for qualified institutional investors and 15% for non-institutional investors and 35% for retail investors.

The company will be used the net proceeds from the fresh issue for repayments of loans, working capital requirements, upgrading & expanding the facilities at Chennai, and use for general corporate purposes.

Price Band of the IPO:

The price band of the IPO has been fixed at ₹555-₹585 per equity share and the face value is ₹2 of each equity share.

Lot Size of the IPO:

The investors can bid a minimum of one lot and a maximum of 13 lots in this IPO. You can invest a minimum of ₹14,625 (₹585x₹25) whereas the maximum investment allowed in this IPO is ₹1, 90,125 [(₹585x₹25) x13]. 

 IPO opening & Closing Date: 

The IPO launched for subscription on 13th December 2021 and the IPO will be closed on 16th December 2021.

Data Patterns IPO Allotment: 

The allotment date of the IPO is 21st December 2021 and the initiation of the refund is likely on 22nd December of unsuccessful investors. The credit of the shares of Data Patterns in the Demat account of the lucky bidders is expected on the 23rd of December 2021.

Listing Date: 

The IPO is a book-built issue type and it will be listed on both BSE and NSE, and the expected to list on 24th December 2021.

How to Check the IPO Allotment Online:

Data Patterns (India) Limited will finalize the basis of allotment by the 21st of December 2021. The investors can check their allotment status either on the BSE website or the website of the IPO registrar.

The bidders can check the allotment on the BSE Website.

 Select equity share and issue name.

 Enter the application number and PAN number.

 Finally, check the box (I’m not a robot) and click on search.

Should we subscribe or not?

The company has a good valuation and no litigation on the company. Good company with experienced promoters. Only one negative point is a small company  ( size -₹225 crores). Market experts suggested that the investors should invest or bid in this IPO for big listing gain and for long-term gain also. Short-term investors also bidding in this IPO.

The Metro Brands IPO Analysis:

Metro brands footwear under its brands of the metro like Mochi, Walkway, Da Vinci, and J Fontini, as well as certain third-party brands as Crocs, Skechers, Clarks, Florsheim, and Flipflop which complement the in-house brands. Mr. Rakesh Jhunjhunwal’s wife Mrs. Rekha Jhunjhunwala is the third-largest shareholder (owning a 14.73% stake) in this company.

Metro Brands plans in the future to add the store and expansion of product portfolio would cater to growing demand in branded footwear and make the way for sustainable earnings. The company improved the operational parameters in the future for growth. The company opens new stores under Metro, Mochi, Walkway, and Crocs brands from the fresh issue.

Metro Brands established in 1955, is one of the largest Indian footwear specialty retailers in India. The company caters to the need of the customers with a wide range of branded footwear for the entire family including men, women, and kids, and also for different occasions. 

The company provides the mid and premium range of footwear in the market which is the higher presence of the organized players and growth in the overall footwear industry. The company also offers accessories such as belts, bags, socks, masks, and wallets at their stores.

The company caters to the retail foot care and shoe care products at their stores through the joint venture, M.V Shoe Care Pvt. Ltd. Metro Brands follows the company-owned and company-operated model of retailing through their multi brands' outlet and exclusive brands outlets to manage their store.

As of 30th September 2021, Metro Brands operated 598 stores across 136 cities and 30 states including union territories in India. The company has big support from Mr. Rakesh Jhunjhunwala was investing in Metro Brands since 2007.

Strength:

Currently, Metro Brands have 598 stores in 136 cities spread across India, 211 stores were opened in the last three years. Metro Brands had the highest number of exclusive retail outlets in India, in fiscal 2021.

One of the largest pan India footwear retailers and it’s a fast-growing footwear retail industry.

Wide range of products for the entire family and all age group and market segments resulting in strong customer loyalty.

Presence of multiple formats and channels.

Strong promoter background and experienced and entrepreneurial management team.

Key Risk: 

Inability to identify customer demand accurately and maintain an optional level of inventory in its store.

Failure to renew the lease or lease cost of premises of its stores and warehouses.

Dependency on third parties for manufacturing for all the products that the company sells.

Failure to obtain, renew or maintain the required regulatory & statutory permits.

The Metro Brands IPO Details: 

The footwear retailer Metro Brands Ltd. Will roll out its IPO on the 10th of December and the three-day issue will close on the 14th of December.

The company fixed the price band of the IPO is ₹ 485 – 500 per equity share. And it has raised a little over ₹410 crores from anchor investors ahead of IPO.

The company will fetch ₹1,367.51 crores from its initial stake.

The company has been reserved 50% of shares for qualified institutional investors and 15% is reserved for non-institutional investors. The retail has been fixed at 35% of the issue.

The IPO opening date is the 10th of December 2021.

IPO closing date is the 14th of December 2021.

The IPO is the book-built issue and the face value of the IPO is ₹5 per equity share.

The market lot size of the IPO is 30 shares and the minimum order quantity is on lot (30shares).

The IPO is listed on both NSE and BSE.

The allotment date of the IPO is the 17th of December.

The initiation of the refund on 20th December of the unsuccessful investor.

The shares will be credited to the Demat account on 21st December of lucky investors.

The IPO listing date is 22nd December.

How to check the share allotment online

The company will finalize the basis of allotment by the 15th of December. The

investors can check their allotment status either on the BSE website or the

website of the IPO registrar.

 

 The bidders can check the allotment on the BSE Website.

 Select equity share and issue name.

 Enter the application number and PAN number.

 Finally, check the box (I’m not a robot) and click on search.

IPO Subscribe or Not: 

According to market experts, Metro Brands plans in the future to add the store and expansion of product portfolio would cater to growing demand in branded footwear and make the way for sustainable earnings. The company improved the operational parameters in the future for growth also improved the operational parameters in the future.

 
It has reported strong financial performance with robust cash flow generation. The company is one of the largest footwear retailers with a 3-4% market share in the market space, so the investors can bid the IPO for listing gain and for the long term as per experts.