Is Data Patterns IPO Good OR Bad? Check GMP, IPO Dates & Allotment

Table of Contents

Data Patterns India Limited Introduction

Data Patterns Limited is a defense and aerospace electronics solution in India. The company has had stable revenue growth in the last 3.5 years and also has a sound order book. Chennai based Data Patterns is coming up with an IPO on 14th Dec 2021 comprises a fresh issue of equity shares aggregating up to Rs. 240 crores and an offer for sale of 59.5 lakh shares from existing shareholders.

What are the risk factors in Data Patterns IPO?

1. Company is highly dependent on Government orders, as a huge portion comes from there

2. Data Patterns India Limited has a limited number of customers. So losing any customer may affect the company financials

3. One of the company’s promoters Srinivasagopalan Rangarajan has pledged his shares against loans or securities.

4. Company is involved in certain legal proceedings, which if materialize can have an adverse effect on the company

5. Company IPO objects contain Rs 348 Crores towards Offer for sale (OFS) where the money would go to selling shareholders and company would not get anything

What are the competitive strengths in Data Patterns IPO?

1. Well established in vertically integrated defence and aerospace electronics solutions providers

2. They are one of the fastest-growing companies in the Defence and Aerospace Electronics sector in India.

3. Company has a sound order book with marque customers like the Indian government defence ministry, BrahMos, DRDO, the Indian government space organisation, HAL, BEL and a DPSU involved in the missile space.

4. Data Patterns is an Indian company, therefore, benefitted from the Make In India Programme

5. The Company has shown good profitability

6. The margins of the company are also increasing over the past 3.5 years

What are the product offerings of Data Patterns IPO?

The below products are the company’s major product group:

(i) Radars, (ii) Underwater electronics / communications / other systems, (iii) Electronic warfare suite, (iv) BrahMos programme, (v) Avionics, (vi) small satellites, (vii) ATE for defence and aerospace systems, (viii) COTS.

How are the financials of Data Patterns India Limited?

  1. Data Patterns has shown growth in revenue over the past 3.5 years, also
  2. The company’s profits are increasing over the years
  3. Company has a impressing ROE and ROCE percentage
Financial Year EndedRevenue (₹ Crores)PAT (₹ Crores)EPS (₹)
March 2019131.067.701.65
March 2020156.1021.054.5
March 2021223.9555.5711.89
As of September 30, 202196.4523.214.97
FINANCIALS OF DATA PATTERNS INDIA LIMITED

Who are the Promoters of Data Patterns India Limited?

Srinivasagopalan Rangarajan and Rekha Murthy Rangarajan are the promoters of the company.

Objects of Data Patterns IPO net proceeds

Data Patterns IPO Size is Rs 588.2 Crores and below are the objects of the IPO:

1) Offer for Sale (OFS) Rs 348.22 Crores: However, the company will not get any proceeds from the OFS, the entire OFS will go to selling shareholders

2) Fresh issue of Rs 240 Crores:  Fresh issue would be done towards the following purposes:

  • Prepayment or repayment of all, or a portion, of certain outstanding borrowings availed by our Company;
  • Funding working capital requirements of our Company;
  • Upgrading and expanding our existing facilities at Chennai moreover for
  • General corporate purposes

Data Patterns IPO open & close date

The open date is: 14th Dec 2021

The close date is: 16th Dec 2021

Data Patterns IPO allotment, refund & listing date

The allotment date is: 21st Dec 2021

The refund date is: 22nd Dec 2021

The listing date is: 24th Dec 2021

ALSO READ: Medplus IPO Good or Bad? Check GMP, IPO Dates, Allotment & Review

How to check the allotment status of Data Patterns IPO?

The allotment status will be updated through the link given linkintime.co.in

Data patterns IPO GMP (Grey Market Price)?

As of 21st Dec 2021, the Grey market price of Data Patterns is around Rs 240 (41.03% premium)

Data patterns IPO price band, RHP & details

Price range555 – 585
Minimum order quantity25
(D)RHPView
DATA PATTERNS PRICE BAND

Data Patterns IPO valuation (Overpriced or Underpriced?)

Calculating with its upper price band of Rs 585

Now, the EPS (earning per share) for FY21 is 11.89 so the P.E ratio (price to earnings ratio) comes at 585/11.89=49.20x

If we consider the last 6 months ended Sep-21 EPS which is 4.97, therefore the P.E comes at 585/4.97=117.70x

Now, if we annualise it for FY-21 the P.E appears as 117.70/2= 58.85x

Therefore, the company is asking P.E ranging between 49X to 59X which is reasonably priced

However, there are listed peers like Paras Defence trading at P.E 139x and Bharat Electronics trading at P.E 23x, comparing with peers it seems IPO is well priced.

ALSO READ: Is HP Adhesives IPO Good or Bad? Check GMP, IPO Allotment & Review

Data Patterns IPO IPO good or bad? (review)

Data Patterns Limited is among the few vertically integrated defence and aerospace electronics solutions provider catering to the indigenously developed defence products industry. Moreover, Company has a unique business model and also benefitted from Make In India Mission, most importantly company has shown consistent growth in profitability and margins over the past three years. The EBITA and ROE, ROCE are also in a boost.

Looking at all these factors, in short, the company has a good track record both financially and business-wise too. So, one can definitely go for investment in Data Pattern Limited. And for listing gains as we have noticed earlier how one of its peers Paras Defence listed with a premium of 170%. So Data Patterns too can have a bumper listing ahead.

Rating: 5 out of 5.

FAQ

1. How much retail quota is there in Data Patterns IPO?

QIB Shares Offered Not more than 50% of the offer
Retail Shares Offered Not less than 35% of the offer
NII (HNI) Shares Offered Not less than 15% of the offer

2. How to apply for Data Patterns IPO?

Steps to apply in Medplus Health IPO through Zerodha
Visit the Zerodha website and log in to Console.
Go to Portfolio and click the IPOs link.
Go to the ‘Medplus Health IPO’ row and click the ‘Bid’ button.
Enter your UPI ID, Quantity, and Price.
‘Submit’ IPO application form.
Visit the UPI App (net banking or BHIM) to approve the mandate.

3. What is the pre and post-promoter holding in Data Patterns IPO

Pre Issue Share Holding 58.63% Post Issue Share Holding 45.62%

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