At a Glance
Gretex is a SEBI-registered Category-I Merchant Banker that lists SME IPOs faster than your cousin changes careers. While sales exploded 23x in 2 years, FY25 net profit vanished. Meanwhile, P/E is 500+, and other income is doing all the heavy lifting. Bubble or misunderstood microcap?
1. 🔥 Introduction with Hook
Remember that one finance guy in every family WhatsApp group who keeps forwarding SME IPO tips?
Chances are, at least a few of those came via Gretex Corporate Services Ltd, a Kolkata-based merchant banker that’s helped list 50+ SME companies on BSE.
But now, Gretex seems more like:
- A listing machine during bull runs
- A profit-ghost during downturns
- A dividend overachiever (wait, what?)
- A capital raiser for everyone except itself
FY25 results were… let’s say, complicated.
2. 🧠 WTF Do They Even Do? (Business Model)
Gretex does “merchant banking”—but not the fancy JM Financial type.
Here’s what they actually do:
| Segment | Activities |
|---|---|
| 📈 SME IPO Advisory | Help SMEs raise capital via BSE SME listings |
| 🏗️ Debt Syndication | Arrange loans, structure NBFC/Bank financing |
| 🔧 Restructuring & Compliance | Legal, ROC, SEBI, and audit documentation |
| 📊 Valuation & Due Diligence | Work with CA firms for IPO valuations |
| 📚 M&A & Strategic Advisory | For small cos that can afford it |
They’re also aggressively signing IPO mandates, especially in manufacturing and steel—latest being a tip-trailer OEM and a Pune-based steel company.
3. 📈 Financials Overview – Profit, Margins, ROE, Growth
Let’s talk numbers (and maybe cry a little).
| Metric | FY23 | FY24 | FY25 |
|---|---|---|---|
| Revenue | ₹14 Cr | ₹113 Cr | ₹259 Cr |
| Net Profit | ₹22 Cr | ₹37 Cr | ₹2 Cr |
| EBITDA Margin | 62% | 43% | 1% |
| ROE | 32% | 20% | 0.86% |
Yes, you read that right. ₹259 Cr in revenue, ₹2 Cr in profit.
Gretex is proof you can 18x your sales and still 95% wipe out your PAT.
4. 💸 Valuation – Is It Cheap, Meh, or Crack?
| Metric | Value |
|---|---|
| CMP | ₹287 |
| Market Cap | ₹650 Cr |
| P/E | 500+ |
| P/B | 3.35x |
| Book Value | ₹85.5 |
🧮 Fair Value Estimate
Let’s assume a normalized EPS of ₹5–₹8 (not current EPS of ₹0.58) and apply a generous 20–25x P/E.
🧮 FV Range = ₹100 – ₹200 (and that’s being kind)
Current price? 🚨 Overvalued unless FY26 pulls a miracle.
5. 🍲 What’s Cooking – News, Triggers, Drama
Here’s the recent Gretex gossip:
- 💼 Signed IPO mandates with 2 new firms (steel & trailers)
- 🏢 Closed Indore & Jaipur branches – cost-cutting mode?
- ⚖️ SEBI slapped ₹20L penalty for listing process violations
- 🎯 Merchant banker for high-profile SME IPOs (like Yug Decor, Nikita Papers, Marc Loire)
Trigger ahead?
FY26 could be better if listing pipeline translates to fees + profit.
6. 🏦 Balance Sheet – How Much Debt, How Many Dreams?
| Metric | FY25 | FY24 |
|---|---|---|
| Total Assets | ₹270 Cr | ₹177 Cr |
| Equity + Reserves | ₹193 Cr | ₹109 Cr |
| Total Debt | ₹11 Cr | ₹4 Cr |
| Debt/Equity | 0.05x | 0.03x |
✅ Debt negligible.
⚠️ But nearly ₹130 Cr parked in “Investments” = capital not working hard enough.
7. 💰 Cash Flow – Sab Number Game Hai
| Metric | FY25 |
|---|---|
| CFO | ₹-31 Cr |
| CFI | ₹+2 Cr |
| CFF | ₹+28 Cr |
| Net Cash Flow | ₹-2 Cr |
So essentially:
- Operations burnt cash
- Investments pulled back
- Raised capital (maybe IPO mandates got prepaid?)
8. 🧮 Ratios – Sexy or Stressy?
| Ratio | FY25 |
|---|---|
| ROE | 0.86% |
| ROCE | 2.69% |
| OPM | 1% |
| Dividend Payout | 275% (!) |
| Working Capital Days | 110 |
| Debtor Days | 3 (surprisingly low) |
Wait… Dividend payout 275% despite a ₹2 Cr profit?
Either it’s generosity… or shareholder distraction 🤔
9. 🧾 P&L Breakdown – Show Me the Money
| Year | Revenue | PAT | EPS |
|---|---|---|---|
| FY22 | ₹4 Cr | ₹4 Cr | ₹1.59 |
| FY23 | ₹14 Cr | ₹22 Cr | ₹9.83 |
| FY24 | ₹113 Cr | ₹37 Cr | ₹12.4 |
| FY25 | ₹259 Cr | ₹2 Cr | ₹0.58 |
From ₹12 EPS to ₹0.58. Basically:
Sales up 2x, but margin evaporated. No moat, only float?
10. ⚖️ Peer Comparison – Who Else in the Game?
| Company | P/E | ROE | PAT | Mcap |
|---|---|---|---|---|
| Gretex | 500x | 0.86% | ₹2 Cr | ₹650 Cr |
| Quest Capital | 20x | 1.7% | ₹20 Cr | ₹384 Cr |
| Mefcom | Negative | -10% | ₹-4 Cr | ₹68 Cr |
| 21st Century Mgmt | 5.2x | 23.7% | ₹-11 Cr | ₹65 Cr |
Gretex has the highest P/E and lowest profit. But it sounds cool at investor meets.
11. 🔍 Miscellaneous – Shareholding, Promoters
| Holder | % |
|---|---|
| Promoters | 64.02% (falling; was 73.5% in FY22) |
| Public | 35.98% |
| No. of Shareholders | 1,145 |
🚩 Promoter holding dropped ~10% in 2 years.
SEBI fine adds more regulatory scrutiny.
Branches closing = maybe time for lean ops?
12. 🧑⚖️ EduInvesting Verdict™
✅ SME IPO engine with solid listing credentials
❌ FY25 = profit collapse, despite booming revenue
🚨 Crazy P/E, low margins, SEBI penalty = risky optics
🤷🏻♂️ Not much visibility on core fee income vs. “other income” magic
Final Line:
“Gretex lists others for a living—but might need a listing of its own sins before investors feel safe again.”
✍️ Written by Prashant | 📅 11 July 2025
Tags: Gretex Corporate Services, SME IPOs, merchant banking, SEBI fine, financial services, capital markets, EduInvesting
