Laxmi Dental IPO Review 2025 : Should You Invest?laxmi dental ipo is good or bad

Laxmi Dental IPO Review
Laxmi Dental IPO Review

Laxmi Dental IPO Review: Should You Invest? Laxmi Dental Limited is launching its Initial Public Offering (IPO), creating excitement among investors. The IPO will open on January 13, 2025, and close on January 15, 2025. Investors are keen to know whether they should apply for it or not. This article will provide a clear, detailed, and unbiased review of the Laxmi Dental IPO. We will analyze its business model, financials, valuation, and more, with real-life examples and a practical perspective.

laxmi dental ipo is good or bad

Laxmi Dental IPO Review
Laxmi Dental IPO Review


Understanding the Business of Laxmi Dental

Laxmi Dental Limited operates in the dental products manufacturing industry. Dental products are essential in modern healthcare. For example, think of someone who needs an artificial tooth after tooth extraction. Laxmi Dental creates these artificial teeth, aligners to fix crooked teeth, and thermoforming sheets for dental applications.

The company’s product portfolio includes:

  1. Custom Crowns and Bridges: Essential for dental restorations.
  2. Aligners: Popular among those wanting straighter teeth.
  3. Thermoforming Sheets: Used to produce dental trays and molds.

These products are in high demand. With dental care becoming more common and accessible, the company’s field is growing rapidly. Laxmi Dental also has a presence not just in India but globally, giving it a competitive edge.


IPO Details

Before we dive deeper, let’s look at the IPO timeline and pricing:

  • Opening Date: January 13, 2025
  • Closing Date: January 15, 2025
  • Allotment Date: January 16, 2025
  • Refund Date: January 17, 2025
  • Listing Date: January 20, 2025

Price Band: ₹407 (lower) to ₹428 (upper) per share.
Lot Size: 33 shares.
Funds Required for a Single Lot: ₹14,124.
Issue Size: ₹700 crores, with ₹138 crores as fresh issue and ₹560 crores as an offer for sale (OFS).

This small issue size makes the IPO competitive. Getting an allotment could be challenging.


Financial Performance

The financials of Laxmi Dental give a mixed picture. Here’s a breakdown:

  1. Revenue Growth:
    • FY22: ₹138 crores.
    • FY23: ₹163 crores.
    • FY24: ₹195 crores.
    • H1 FY25: ₹117 crores (projected to reach ₹230-250 crores for FY25).
    Revenue has grown steadily, indicating strong demand for the company’s products.
  2. Profit After Tax (PAT):
    • FY22: Loss of ₹18 crores.
    • FY23: Loss reduced to ₹4 crores.
    • FY24: Profit of ₹25 crores.
    • H1 FY25: Profit of ₹22 crores.
    The transition from losses to profits is significant. If the company maintains this trend, it could gain more investor trust.
  3. Assets:
    Asset value saw slight fluctuations but showed growth in FY24 and H1 FY25.
  4. Debt Concerns:
    The company’s debt-to-equity ratio is high at 0.94. However, the ₹138 crores from the IPO will reduce debt, improving financial health.

Peer Comparison

Laxmi Dental competes with Poly Medicure Limited, a well-established company. Comparing key metrics:

  1. Market Cap:
    • Laxmi Dental: ₹2,350 crores.
    • Poly Medicure: ₹27,180 crores.
  2. Price-to-Book Value:
    • Laxmi Dental: 50x.
    • Poly Medicure: 16x.
  3. P/E Ratio:
    • Laxmi Dental: 87x.
    • Poly Medicure: 94x.

Laxmi Dental appears expensive in terms of price-to-book value but reasonable in terms of P/E ratio.


Positives and Negatives

Positives:

  1. Fast-Growing Market:
    The dental industry is expanding rapidly. Personal example: Over the past few years, I’ve seen more people opting for aligners and dental implants, reflecting the rising demand.
  2. Advanced Technology:
    Laxmi Dental uses cutting-edge methods to create its products, giving it an edge over smaller competitors.
  3. Global Presence:
    Having customers outside India strengthens the company’s position.

Negatives:

  1. Financial Instability:
    Losses in FY22 and FY23 show past struggles. Although profitability has improved, sustained growth is yet to be proven.
  2. High Valuation:
    The IPO is priced on the higher side, which might discourage some investors.
  3. Regulatory Challenges:
    The healthcare sector is heavily regulated, and any compliance issues could impact operations.

Laxmi dental ipo Grey Market Premium (GMP)

As of January 20, 2025, the IPO has a grey market premium (GMP) of ₹165. This suggests strong demand, as investors are willing to pay extra for the shares.


Listing Expectations

  1. Optimistic Scenario:
    • Expected Listing Price: ₹600 per share.
    • Profit per Lot: ₹5,676.
  2. Worst-Case Scenario:
    • Expected Listing Price: ₹400 per share.
    • Loss per Lot: ₹924.
  3. Most Likely Scenario:
    • Expected Listing Price: ₹550-₹600 per share.
    • Profit per Lot: ₹4,026-₹5,676.

Should You Apply for the Laxmi Dental IPO?

If you are an investor willing to take moderate risks for potential listing gains, this IPO is worth considering. The following points summarize the decision:

  1. For Short-Term Gains:
    The grey market suggests a positive listing. If you can risk a small loss for a chance at ₹3,000-₹5,000 profit, you should apply.
  2. For Long-Term Investment:
    Consider the company’s financial stability and growth potential. While the dental market is promising, the high valuation and past losses require caution. Poly Medicure might be a safer long-term choice.

Final Thoughts

Laxmi Dental’s IPO presents an exciting opportunity, especially for short-term investors. However, always assess your risk appetite and financial goals before investing. A balanced approach can help you make a better decision.

Let us know your thoughts on this IPO in the comments below. If you found this review helpful, share it with fellow investors and subscribe to stay updated on the latest IPO reviews!