At the upper price band of Rs 121-128 per, the issue size is Rs 226 crore.
The company is demanding a price to sales valuation of 0.4 times to its FY18 sales. Based on FY19E and FY20E sales, the issue is demanding a P/S valuation of 0.3 times.
“Considering the importance and positioning of its services among various government entities, favourable government policies for business growth, stable dividend payout and improvement in the financial performance, the issue seems to be attractively priced,” said Choice Broking.
MSTC is offering a discount of Rs 5.5 per share on the allotment price to retail investors.
The financial performance of the company is not encouraging. Despite reporting increased transactions across the marketing and e-commerce segments, it reported a 16.2 per cent CAGR decline in top line over FY16-18, which was mainly due to sharp decline the sales of thermal coal. Reported Ebitda was at loss for the majority of the time period, analysts said.
Revenue for the first half of FY19 came in at Rs 1,491.55 crore. For FY18, FY17 and FY16, sales stood at Rs 2,793.15 crore and Rs 1,876.2 crore and Rs 3307.80 crore, respectively. Revenue for the trading vertical stood at Rs 1,207.52 crore for the six months ended September 30; e-commerce vertical sales stood at Rs 104.57 crore.
