Courtesy: https://www.chittorgarh.com/
Review By Dilip Davda on November 25, 2025
- The company is engaged in the business of digital PRO AV integration, which is getting overcrowded now.
• The company posted impressive financial performance, but it appears to be a fabricated one to fetch fancy valuations.
• Based on its recent financial data, the issue appears fully priced.
• Only well-informed/cash surplus/risk seekers may park funds for medium term, others may skip.
ABOUT COMPANY:
Purple Wave Infocom Ltd. (PWIL) is engaged in the business of digital PRO AV (professional audio-video) integration, post-sales support and distribution. Audio video (AV) integration involves the combination of audio, video, and control systems into a unified solution. It provides end-to-end customized digital PRO AV and automation solutions which includes designs, integration, management & onsite support including cloud-based communication and automation solutions for organizations across the country and in overseas market. Its technological solutions re-define communication, connectivity and creative synergy. The company excels in designing and implementing customized AV solutions for corporate boardroom, organized retail digital branding, indoor & outdoor advertising, smart classroom, government projects, place of worship, home theatre, experience centre and other industries.
The company also offers value added services such as content management service – in Software as a service (SaaS) model, a cloud-based tool that helps users create, store, edit and publish digital content on their screens. It is also offering live streaming and content management services through “Streampurple”. In addition to integration, the Company is also engaged in direct selling and distribution of PRO AV products including but not limited to active LED screens (indoor/outdoor), professional display screens (touch / non-touch screens), digital signage screens, electronics shelf labels (ESL), digital podium, video conferencing cameras, processors, media players, speakers, mics, amplifiers, unified communication (UC) devices, hearing assistive device, mounts, cables and accessories.
It is also offering after-sales value added services includes annual maintenance contract (AMC) for technical support, repair & maintenance services of AV infrastructure to ensure optimal product performance and customer satisfaction. Its customized AV solutions enable individuals and organizations to communicate, collaborate and present information more effectively and efficiently. The company caters to the specialized needs of corporates and individuals’ clients by providing PRO AV and automation solutions designed to meet individual preferences and diverse user requirements. Its PRO AV solution helps in aiding the digital transformation across the sectors such as advertising technology (AdTech), education technology (EdTech), unified communication (UC) and AV entertainment & automation. As of September 30, 2025, it had 86 employees on its payroll.
ISSUE DETAILS:
The company is coming out with its maiden book building route IPO of 2496000 equity shares of Rs. 10 each to mobilize Rs. 31.45 cr. at the upper cap. The issue opens for subscription on November 28, 2025, and will close on December 02, 2025. The company has announced a price band of Rs. 100 – Rs. 126 per share. Post allotment, shares will be listed on BSE SME. The minimum application to be made is for 2000 shares and in multiples of 1000 shares thereon, thereafter. The issue constitutes 27% of the post-IPO paid-up capital of the company. From the net proceeds, it will utilize Rs. 12.91 cr. for capex for on office space and product display area, Rs. 10.00 cr. for repayment/prepayment of certain borrowings, and the rest for general corporate purposes.
The IPO is solely lead managed by Smart Horizon Capital Advisors Pvt. Ltd., while Maashitla Securities Pvt. Ltd., is the registrar to the issue. Shreni Shares Ltd. is the market maker and also a syndicate member.
Having issued the initial equity capital at par value, the company issued further equity shares in the price range of Rs. 120 – Rs. 150 between March 2010, and March 2013. It has also issued bonus shares in the ratio of 50.721 for 1 in March 2022, and 3.5 for 1 in October 2024. The average cost of acquisition of shares by the promoters is Rs. NIL, Rs. 0.19 and Rs. 24.44 per share.
Post-IPO, company’s current paid-up equity capital of Rs. 6.75 cr. will stand enhanced to Rs. 9.25 cr. Based on the upper price band of the IPO, the company is looking for a market cap of Rs. 116.50 cr.
FINANCIAL PERFORMANCE:
On the financial performance front, for the last three fiscals, the company has posted total income / net profit, of Rs. 70.44 cr. / Rs. 0.66 cr. (FY23), Rs. 90.04 cr. / Rs. 5.44 cr. (FY24), Rs. 126.15 cr. / Rs. 9.12 cr. (FY25). For Q1 of FY26 ended on June 30, 2025, it posted a net profit of Rs. 3.58 cr. on a total income of Rs. 35.91 cr. Quantum jump in net profits from FY24 onwards raises eyebrows and concern over its sustainability as it is operating in a highly competitive and fragmented segment. Rising Trade receivables raises alert. Sustainability of margins going forward is a major concern as it is operating in a highly competitive and fragmented segment.
For the last three fiscals, the company has posted an average EPS of Rs. 9.60, and an average RoNW of 52.50%. The issue is priced at a P/BV of 4.07 based on its NAV of Rs. 30.93 per share as of June 30, 2025, but its post-IPO NAV data is missing from the offer documents.
If we attribute annualized super earnings of FY26 on post-IPO paid-up capital, then the issue price is at a P/E of 8.14, and based on its FY25 earnings, the P/E stands at 12.78. Thus, the issue appears fully priced based on its recent earnings, but the margins it posted may not be sustained, as it is operating in a highly competitive environment.
For the reported periods, the company has posted PAT margins of 0.94% (FY23), 6.05% (FY24), 7.23% (FY25), 9.97% (Q1-FY26), and RoCE margins of 20.98%, 42.43%, 42.80%, 14.48% respectively for the referred periods.
DIVIDEND POLICY:
The company has not paid any dividends for the reported periods. It will adopt a prudent dividend policy, based on its financial performance and future prospects.
COMPARISON WITH LISTED PEERS:
As per offer document, the company has shown Pro FX Tech, as its listed peer. It is currently trading at a P/E of 11.3 (as of November 25, 2025). However, they are not truly comparable on an apple-to-apple basis. Such comparison appears to be an eyewash.
MERCHANT BANKER’S TRACK RECORD:
This is the 17th mandate from Smart Horizon Capital in the last two fiscals, out of last 10 listings, 2 opened at discount, 1 at par, and the rest with premium ranging from 0.81% to 6.03%, thus it has an average track record.
Conclusion / Investment Strategy
PWIL is engaged in the business of digital PRO AV integration, which is getting overcrowded now. The company posted impressive financial performance, but it appears to be a fabricated one to fetch fancy valuations. Based on its recent financial data, the issue appears fully priced. Merchant banker has an average track record. Small post-IPO equity base indicates longer gestation period for migration. Only well-informed/cash surplus/risk seekers may park funds for medium term, others may skip.
Review By Dilip Davda on November 25, 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/
