Courtesy: https://www.chittorgarh.com/
Review By Dilip Davda on October 3, 2025
- The company is engaged in the business of manufacturing caps and closures and PET Performs and related products.
• It posted growth in its top and bottom lines for the reported periods.
• Based on its recent financial data, and market price behaviors, it is priced aggressively.
• The RI is being offered to other than the promoter stakeholders.
• Well-informed investors may park moderate funds for long term.
ABOUT COMPANY:
Cool Caps Industries Ltd. (CCIL) is engaged in the business of manufacturing Caps & Closure and PET Preforms, Plastic handles and PET (Polyethylene terephthalate) in Granules form is used as the primary raw material during its manufacturing process. Therefore, it is highly dependent on PET, and it forms the most important and primary component of manufacturing process.
It has not entered into long term contracts with suppliers and prices for raw materials are normally based on the quotes it receives from various suppliers. Since it has no formal arrangements with suppliers, they are not contractually obligated to supply their products to CCIL and may choose to sell their products to competitors. Non-availability or inadequate quantity of raw material or use of substandard quality of the raw materials in the manufacturing of products, could have a material adverse effect on its business. Further, any discontinuation or a failure of these suppliers to adhere to the delivery schedule or failure to deliver the required quality and quantity could hamper manufacturing schedule.
CCIL’s business model requires it to maintain a certain level of inventory of raw material, to meet the present and future orders. If it underestimates the orders that the company may receive it may experience inventory shortages and a loss of opportunity. Similarly, an over estimation of orders may result in over stocking leading to increased holding costs. Additionally, any over run in holding of such goods may lead to their decay. Therefore, any mismanagement on its part to determine the optimum inventory levels may impact operations and cause to incur losses.
Its top ten customers have contributed 27.20% and 37.40% of revenues for the period ended March 31, 2025, and March 31, 2024 based on Audited Standalone financials. The offer document is silent on its employees’ strength.
ISSUE DETAILS:
The company is coming out with its Rights Issue (RI) of 39995000 equity shares of Rs. 2 each at a fixed price of Rs. 70 per share to mobilize Rs. 279.97 cr. The company is offering RI in the ratio of 1 for 1 to its eligible stakeholders (other than the promoters) as of the record date of September 23, 2025. It is asking only Rs. 17.50 (25%) per share on application for the number of shares applied. The rest will be call ed by one or more calls by the company from time to time. The RI has already opened for subscription on September 30, 2025, and will close on October 24, 2025. Post allotment, shares will be listed on NSE. The company is spending Rs. 17.84 cr. for this RI process, and from the net proceeds, it will utilize Rs. 64.92 cr. for repayment/prepayment of certain borrowings, Rs. 24.02 cr. for repayment/prepayment of certain borrowings by its subsidiaries, Rs. 2.31 cr. for investment in subsidiary Purv Packaging Pvt. Ltd., Rs. 14.49 cr. for investment in its subsidiary Purv Ecoplast Pvt. Ltd., Rs. 40.33 cr. for working capital, Rs. 11.94 cr. for working capital of Purv Packaging Pvt. Ltd., Rs. 36.62 cr. for working capital of Purv Ecoplast Pvt. Ltd., and Rs. 67.50 cr. for general corporate purposes.
The RI is self-managed by the company itself, and MUFG Intime India Pvt. Ltd. is the registrar to the issue.
Post RI, company’s current paid-up equity capital of Rs. 23.12 cr. will stand enhanced to Rs. 31.12 cr. Based on the RI price, the company is looking for a market cap of Rs. 1089.17 cr.
FINANCIAL PERFORMANCE:
On the financial performance front, for the last two fiscals, the company posted a total revenue/net profit of Rs. 161.03 cr. / Rs. 3.93 cr. (FY24), Rs. 271.85 cr. / Rs. 11.97 cr. (FY25). Its NAV stood at Rs. 47.42 as of March 31, 2025.
DIVIDEND POLICY:
The company has not declared any dividends for the reported periods of the offer document. It will adopt a prudent dividend policy post listings of RI shares based on its financial performance and future prospects. Its offer document is silent on its dividend policy.
SCRIP PERFORMANCE: BASED ON NSE WEBSITE DATA: SCRIP CODE: COOLCAPS (FV Rs. 2).
The scrip last closed on cum-right basis at Rs. 102.45 on September 22, 2025, and opened on an ex-right basis at Rs. 96.00 on September 23, 2025. Since then, it has marked a high/low of Rs. 99.50 / Rs. 86.90. The scrip last closed at Rs. 89.00 as of October 01, 2025. For the last 52 weeks’ it has posted a high/low of Rs. 99.50 / Rs. 57.38.
The promoters’ holding has declined to 65.40% as of July 07, 2025 against 70.86% for the quarter ended December 31, 2024. The counter is well managed above the RI price to lure investors.
Conclusion / Investment Strategy
CCIL is engaged in the business of manufacturing caps and closures and PET Performs and related products. It posted growth in its top and bottom lines for the reported periods. Based on its recent financial data, and market price behaviors, it is priced aggressively. The RI is being offered to other than the promoter stakeholders. Well-informed investors may park moderate funds for long term.
Review By Dilip Davda on October 3, 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/
