Courtesy: https://www.chittorgarh.com/
Review By Dilip Davda on September 8, 2025
- The company shifted its business from diamond studded jewellery to pharmaceutical products, which remains major concern.
• The company marked inconsistency in its top and bottom lines for the reported periods.
• It is fully dependent on third party supply for its pharmaceutical business.
• Based on its recent financial data, the issue appears aggressively priced.
• There is no harm in skipping this pricey and “High Risk/Low Return” bet.
ABOUT COMPANY:
Deep Diamond India Ltd. (DDIL) was originally engaged in the manufacture and wholesale of gold set jewelry with diamonds. The company also dealt in loose diamonds, solitaires, and gold frames. It offered Pendants, Nose pins, Rings, Bangles, Earrings, Pendant sets, Necklace sets, Bracelets, and others.
During the year 2023 the company diversified its business into pharmaceuticals business with professional management team at its Board. The company has carved a niche amongst the trusted names in the market. Leveraging the skills of qualified team of professionals, it is instrumental patient-centric solution services to improve quality of life. Hence, offered services feature an ideal combination of high compatibility, quality, specific design and cost-effective price.
As the company has recently forayed into pharmaceutical business and is engaged in services relating to organizing medical camps, patients’ assistant services, Field counselling, patient screening etc. and it may enter into marketing, trading and distribution of pharmaceutical formulation products. As on date of Letter of offer, it does not have own manufacturing facility, and it will have to rely on third parties for manufacturing the formulation products, which will be marketed by it. Any decline in the quality of products manufactured by third parties or delay in delivery of products by such parties, may adversely affect its operations. Further there can be no assurance that such parties shall continuously provide their products to DDIL or would not cater to demand of competitors. Any withdrawal of services from such manufacturers or supply of services to competitors at better rates may adversely affect result of operations and future prospects.
ISSUE DETAILS:
The company is coming out with its Rights Issue (RI) of 96100000 equity shares of Re. 1 each at a fixed price of Rs. 4.16 per share to mobilize Rs. 39.98 cr. The RI opens for subscription on September 09, 2025, and will close on September 19, 2025. The company is offering RI in the ratio of 2 for 1 to its eligible stakeholders as of the record date of August 29, 2025. The company is asking for full money on application for number of shares applied. Post allotment, RI shares will be listed on BSE. The company is spending Rs. 0.35 cr. for this RI process, and from the net proceeds, it will utilize Rs. 30.00 cr. for acquiring Oasis Ceramics Pvt. Ltd., and Rs. 9.63 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. Navigant Corporate Advisors Ltd. is the advisor to the issue.
Post-RI, company’s current paid-up equity capital of Rs. 4.81 cr. will stand enhanced to Rs. 14.42 cr. Based on the RI pricing, the company is looking for a market cap of Rs. 59.97 cr.
FINANCIAL PERFORMANCE:
On the financial performance front, for the last two fiscals, the company has (on a consolidated basis) posted total income / net profit, of Rs. 3.65 cr. / Rs. 0.40 cr. (FY24), and Rs. 2.01 cr. / Rs. 0.88 cr. (FY25). For Q1 of FY26 ended on June 30, 2025, it earned a net profit of Rs. 0.06 cr. on a total income of Rs. 0.34 cr. Thus, it marked inconsistency in its top and bottom lines for the reported periods.
DIVIDEND POLICY:
The company has not declared any dividends for the reported periods of the offer document. It will adopt a prudent dividend policy, based on its financial performance and future prospects. However, the offer document is silent on its dividend policy.
SCRIP PERFORMANCE: BASED ON BSE WEBSITE DATA: SCRIP CODE: 539559 (FV Re. 1).
The scrip last closed on cum-right basis at Rs. 4.70 on August 28, 2025, and opened on an ex-right basis at Rs. 4.63 on August 29, 2025. Since then, it has marked a high/low of Rs. 4.70 / Rs. 4.01. The scrip last closed at Rs. 4.22 as of September 08, 2025. For the last 52 weeks’ it has posted a high/low of Rs. 10.84 / Rs. 3.55.
The promoters’ holding has been constant around 0.08% for the last three quarters ended with June 30, 2025. The counter is well managed above the RI price to tempt investors.
Conclusion / Investment Strategy
DDIL shifted its business from diamond studded jewellery to pharmaceutical products, which remains major concern. The company marked inconsistency in its top and bottom lines for the reported periods. It is fully dependent on third party supply for its pharmaceutical business. Based on its recent financial data, the issue appears aggressively priced. There is no harm in skipping this pricey and “High Risk/Low Return” bet.
Review By Dilip Davda on September 8, 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/
