Shankara Building Products IPO: Facts You must Consider before Investing in

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Bengaluru based, Shankara Building Products IPO would open for subscription on 22nd March, 2017. Shankara Building Products Ltd. is the leading organized retailers of home improvement and building products in india.

 In this article Money Dial is telling you various facts about Shankara Building Products Ltd. those you must know before investing in this IPO.

  • Shankara Building Products Ltd. is the leading organized retailers of home improvement and building products in India based on number of stores, these stores operate under the brand name Shankara BuildPro.
  • As on August 31, 2016 they operated 98 Shankara BuildPro stores spread across 10 states in India.
  • As on September 24, 2016, they operated 100 Shankara BuildPro stores spread across 10 states in India.
  • They cater to a large customer base across various end-user segments in urban and semi-urban markets through its multi-channel sales approach, processing facilities, and supply chain and logistics capabilities.

Key strengths of Shankara Building Products

  • Providing its customers a unique experience by offering a comprehensive range of home improvement and building products.
  • Its strong vendor network and relationship built over two decades.
  • Its presence across the entire value chain.
  • Robust back-end infrastructure ensuring efficient supply chain management.

10 Important facts that you must consider before investing in this IPO

  • Low revenue growth at 6.4% CAGR.
  • Although, company earns thousands of crores of revenue, but it just earns 0.6% as profits. This small profit can be eliminated with just a small %age of increase of cost.
  • Success of a company depends on the value, perception and product quality associated with its retail stores.
  • Any negative publicity of its products, its retail stores or its processing facilities may adversely impact its brand equity, sales and results of operations.
  • Success of a company depends upon its ability to attract, develop and retain trained store representatives while also controlling its labour costs.
  • They are subject to payment-related risks that could increase its operating costs, expose them to delays, fraud, and litigation, subject us to potential liability and potentially impact the goodwill of its stores.
  • This company had instances of non-compliances in relation to regulatory filings to be made with the RoC and the RBI under applicable law.
  • Uncertainty regarding the housing market, real estate prices, economic conditions and other factors beyond its control could adversely affect demand for its products and services. Its cost of doing services and its financial performance would also affect.
  • They do not have definitive agreements with a majority of its vendors for supply of its raw materials and retail products which may adversely affect its business and results of operations.

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