About Company:

Incorporated in 2010, Siddhika Coatings Ltd is a key supplier of SK Kaken Ltd (SKK) products and its specialist paint in India. SKK is a Japan-based coatings and pigments manufacturer, and being a strategic channel partner of SKK, Siddhika Coatings Ltd is engaged in the business of supplying Architectural Coatings Supplies & Applications in India. The firm also offers application services like coating interior as well as exterior surfaces of civil structures using organic and inorganic architectural pigments and technical-grade functional coatings.

It supplies products to real estate developers, government and private entities i.e. IT companies, hospitality leaders, business park developers, and various eminent architects in India. It has successfully completed 160+ projects across 11 states in India over the last 3 calendar years. It is serving its customers through its branches in 11 states of India i.e. Delhi, Haryana, Uttar Pradesh, Rajasthan, Himachal Pradesh, Karnataka, Tamil Nadu, Telangana, West Bengal, Gujarat, and Maharashtra.

Competitive strengths:

• India's largest texture paint Contract Company of SKK brand.
• High-quality assurance.
• Experienced promoters and managers.
• Strong geographical presence with branches all over the country.

Promoters:

Siddhika Business Applications Private Limited is the promoter of the company.

Objects of the Issue:

• Meet working capital requirements.
• General corporate Purposes.
• To meet issue expenses.

Company Financial Performance:

Company journey:

Opportunities:

• Paints is a fast moving product in both domestic and industrial sectors.
• Industrial development in India is an area of focus for the incumbent government.
• Newer growth opportunities are likely to open up in the automobile sector, which is a major consumer of paints and related products. The buzz around electric vehicles is likely to zoom automobile sales over the next decade.

Valuations:

At the proposed price point of Rs. 57 per share, Siddhika Coatings IPO is valued post-issue at Rs. 17.61 crores. This microcap has the potential to gain significant market share in India’s paint industry which is a massive Rs. 70,000 crores.

At the latest full year EBITDA of Rs. 425.69 lacs, the Enterprise Value to EBITDA ratio comes approximately to 4. On the price to earnings multiple, the company is valued at FY’25 forward multiple of 31 (Assuming the industry standard growth rate in earnings).

Company product and services:

1 High Build Designer Stone Textures: Stone finish textures are used to give a stone-like effect to a piece of architecture.

2 Thermal insulation coatings and paints: These coatings ensure that heat exchange slows down between the exterior and interior of a building. Naturally, the requirement for air conditioning goes down.

3 The Paints Industry : The paint industry in India is more than 100 years old. The journey of product evolution has been inline with the rising per capita income for the country.

A major chunk (75%) comprises decorative paints. The industrial paints and decorative paints segments are expected to grow at 9.5% and 12.7% respectively.

IPO Details:

You should apply for it or not ?

AS company customer base is strong and there’s always domestic demand in paint industry one can apply for long term.