Courtesy: https://www.chittorgarh.com/
Review By Dilip Davda on June 22, 2025
- This is the 2nd RI from the company since August 2022.
• The counter is trading below par value at present and is a big surprise.
• It played with many gimmicks like bonus issue, split and consolidation to reap benefits of market sentiments.
• Though at par, it’s a highly risky bet considering it inconsistent financial performance.
• Simply stay away from this highly risky bet.
PREFACE:
The company is coming out with its RI to mobilize Rs. 28.01 cr., and is opening for subscription on June 23, 2025, and its offer document is dated June 10, 2025, with a record date of June 09, 2025, but the offer document was not uploaded on the designated exchange till noon of June 19, 2025. Thus, delayed submission of offer documents for RI is unabatedly going on.
ABOUT COMPANY:
7NR Retail Ltd. (7NR) – Company mainly deals in the business of wholesale and retail trading of various fabrics like 100% Cotton – Lycra and Non-Lycra, Blended Cotton Suiting – Chief Value Cotton, Polyester Cotton, 100% Cotton Yarn Dyed, Polyester Viscose, Terry Rayon Suiting and Mock Linen, ready-made garments, shirting and all other related textile products. The Company remained focused on providing distinctive, high quality and trusted products to consumers at right price.
The Company is an entrepreneur driven and well managed organization focused on meeting consumer requirements for meeting their fashion and lifestyle requirements by offering products and services with the finest quality. 7NR faces the competition in business from other existing traders and manufacturers of same products. It competes with competitors on a regional or product line basis. Many of its competitors have substantially large capital base and resources and offer broader range products.
Its Industry is highly competitive while being unorganized and fragmented. This market is not governed directly by any regulations or any governmental authority. The players in the informal education market are mostly small and unrecognized. It faces competition from both organized and unorganized players in the market and more specifically from different players for different sections to which the company offers its Products. The offer document is silent on its employees’ strength data.
ISSUE DETAILS:
The company is coming out with its Rights Issue (RI) of 28006800 equity shares of Rs. 10 each at par value to mobilize Rs. 28.01 cr. The RI is opening for subscription on June 23, 2025, and will close on July 07, 2025. The company is offering RI in the ratio of 1 for 1 to its eligible stakeholders as of the record date of June 09, 2025. The company is asking for full money on application for number of shares applied. Post allotment, shares will be listed on BSE. The company is spending Rs. 1.00 cr. for this RI process, and from the net proceeds, it will utilize Rs. 22.00 cr. for working capital, and Rs. 5.01 cr. for general corporate purposes.
The RI is self-managed by the company itself, and Cameo Corporate Services Ltd. is the registrar to the issue.
Post RI, company’s current paid-up equity capital of Rs. 28.01 cr. will stand enhanced to Rs. 56.01 cr. Based on the RI pricing, the company is looking for a market cap of Rs. 56.01 cr.
FINANCIAL PERFORMANCE:
On the financial performance front, for the last three fiscals, it has posted a total income/ net profit/ – (loss) of Rs. 48.34 cr. / Rs. 0.24 cr. (FY23), Rs. 12.21 cr. / Rs. – (1.12) cr. (FY24), Rs. 21.56 cr. / Rs. 0.33 cr. (FY25). The company has posted inconsistency in its top and bottom lines. In fact, jump in post-RI equity will have its servicing issue considering its minuscule earnings with inconsistency.
DIVIDEND POLICY:
The company has not declared any dividends for the reported periods. It will adopt a prudent dividend policy post listings of RI shares based on its financial performance and future prospects.
SCRIP PERFORMANCE: BASED ON BSE WEBSITE DATA: SCRIP CODE: 540615 (FV Rs. 10).
The scrip last closed on cum-right basis at Rs. 7.73 on June 06, 2025, and opened on an ex-right basis at Rs. 7.97 on June 09, 2025. Since then, it has marked a high/low of Rs. 8.25 / Rs. 7.00. The scrip last closed at Rs. 7.40 as of June 20 2025. For the last 52 weeks’ it has posted a high/low of Rs. 8.30 / Rs. 3.80. The counter is currently under ESM: Stage 1.
The promoters’ holding has been constant around 10.96% for the last three quarters ended with March 31, 2025. The counter is trading below the par value showing the interest of investors for this nasty counter.
Conclusion / Investment Strategy
This is the 2nd RI from the company since August 2022. The counter is trading below par value at present and is a big surprise. It played with many gimmicks like bonus issue, split and consolidation to reap benefits of market sentiments. Though at par, it’s a highly risky bet considering it inconsistent financial performance. Simply stay away from this highly risky bet.
Review By Dilip Davda on June 22, 2025
Review Author
DISCLAIMER: No financial information whatsoever published anywhere here should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is purely for educational and information purposes only and under no circumstances should be used for making investment decisions. My reviews do not cover GMP market and operators game plans. Readers must consult a qualified financial advisor before making any actual investment decisions, based the on information published here. With entry barriers, SEBI wants only well-informed investors to participate in such offers. With crazy listings in the recent past, SME IPOs drew the attention of investors across the board and lead to seer madness. However, as SME issues have entry barriers and continued low preference from the broking community, any reader taking decisions based on any information published here does so entirely at their own risk. The above information is based on information available as of date coupled with market perceptions. The Author has no plans to invest in this offer.
About Dilip Davda
Dilip Davda is veteran journalist associated with stock market since 1978. He is contributing to print and electronic media on stock markets/insurance/finance since 1985.
Dilip Davda is a leading reviewer of public issues and NCDs in the primary stock market in India. The knowledge he gained over 3 decades while working in the stock market and a strong relationship with popular lead managers makes his reviews unique. His detailed fundamental and financial analysis of companies coming up with IPOs helps investors in the primary stock market. Dilip Davda has a special interest in analyzing the SME companies and writing reviews about their public issues. His reviews are regularly published online and in news papers.
(Dilip Davda -SEBI registered Research Analyst-Mumbai,
Registration no. INH000003127 (Perpetual)
Email id: dilip_davda@rediffmail.com ).
Courtesy: https://www.chittorgarh.com/
