1. At a Glance
This SME IPO isn’t here to chill — ₹117.33 Cr is being raised with a frosty mix of fresh issue and offer for sale. But here’s the heat: at ₹125 per share, you’re paying 24x earnings for a chiller manufacturer. The HVAC business is cool. The valuation? Lukewarm, at best.
2. Introduction with Hook
Picture this: a company making chillers and HVAC systems enters the IPO market in July. The irony? The stock might be the hottest thing about them. Founded in 2006, Shree Refrigerations has gone from assembling air coolers to cooling down marines, pharmaceuticals, and chemical labs. And now, they want you to shell out ₹2.5 lakh minimum — just to get in the door.
- FY25 Revenue: ₹99.1 Cr (22% YoY growth)
- FY25 PAT: ₹13.55 Cr (17% growth, and probably a lot of sweating involved)
3. Business Model (WTF Do They Even Do?)
They build chillers. Literally. That’s not slang — their product list includes:
- Water and air-cooled condensing units
- Marine HVACs (Titanic would’ve loved these)
- Printing chillers
- Spray dampening systems
- Test rigs and lab setups
They also offer custom fabrication, so if your machine needs a fridge and a fashion makeover — they’ve got it. The factory in Karad is kitted out with CNC tools and HVAC testing labs.
Basically, they do high-end fridges for nerdy engineers.
4. Financials Overview
| Particulars (₹ Cr) | FY23 | FY24 | FY25 |
|---|---|---|---|
| Revenue | 50.90 | 81.19 | 99.10 |
| EBITDA | 11.90 | 24.38 | 26.94 |
| PAT | 2.57 | 11.53 | 13.55 |
| Net Worth | 45.22 | 60.72 | 114.74 |
| Total Borrowing | 32.07 | 36.80 | 39.73 |
Analysis:
- Revenue doubled in 2 years. That’s not growth — that’s cardio.
- PAT Margin = 13.7% — someone’s optimized their cooling costs.
- EBITDA Margin of 27.3% is… chef’s kiss
5. Valuation
Fair Value Range: ₹90–₹105
- Asking for a P/E of 23.8x (pre-issue)
- P/B: 4.98x — almost startup-esque
- ROE: 15.4% — not bad, but not heroic either
If you think paying 24x for a chiller business is logical, you probably also buy water at airports for ₹90.
6. What’s Cooking – News, Triggers, Drama
- Raised ₹33.41 Cr from anchor investors
- Anchor lock-in ends Aug 29 (50%) and Oct 28 (rest) — watch for ice melting
- 18.25 lakh shares are Offer for Sale — insiders taking some chips off the table
- Use of IPO proceeds? ₹70 Cr for working capital (basically: we need inventory money)
Drama-free, but the only thing colder than their chillers might be the anchor exit timing.
7. Balance Sheet
| Item (₹ Cr) | FY25 |
|---|---|
| Total Assets | 185.60 |
| Net Worth | 114.74 |
| Total Debt | 39.73 |
| Reserves & Surplus | 109.13 |
| D/E Ratio | 0.37 |
Key Comments:
- Low leverage = healthy heart rate
- Net worth doubled in a year — steroids or just solid margins?
- D/E below 0.4 is rare for a capital-intensive HVAC biz. Gold star for that.
8. Cash Flow – Sab Number Game Hai
Not disclosed in RHP, but read between the lines:
- PAT growing → operating cash likely positive
- Inventory/Receivables-heavy business → working capital soaks cash like a sponge
- Borrowings increased ~8% YoY → reinvestment cycle visible
Verdict: “Cash flows are behaving like Indian monsoons — promising but erratic.”
9. Ratios – Sexy or Stressy?
| Metric | FY25 |
|---|---|
| ROE | 15.44% |
| ROCE | 23.22% |
| PAT Margin | 13.72% |
| EBITDA Margin | 27.29% |
| D/E | 0.37 |
| P/B | 4.98 |
Commentary:
- ROCE above 20%? That’s CEO-pat-on-the-back territory.
- P/B at 5x? That’s VC-startup-bubble territory.
- Overall? Sexy ratios, but the valuation… oof.
10. P&L Breakdown – Show Me the Money
| Metric (₹ Cr) | FY23 | FY24 | FY25 |
|---|---|---|---|
| Revenue | 50.90 | 81.19 | 99.10 |
| EBITDA | 11.90 | 24.38 | 26.94 |
| PAT | 2.57 | 11.53 | 13.55 |
- In FY23, PAT margin was 5%. In FY25, it’s 13.7%. That’s some glow-up.
- EBITDA nearly tripled in 2 years. Either they raised prices or became budgeting ninjas.
11. Peer Comparison
| Company | Revenue (₹ Cr) | PAT (₹ Cr) | P/E |
|---|---|---|---|
| Shree Refrigerations | 99.1 | 13.55 | 23.8x |
| Refex Industries | 389.4 | 40.5 | 18.9x |
| Blue Star | 8500+ | 350+ | 36.4x |
| Amber Enterprises | 5000+ | 180+ | 42.0x |
Shree is the lean new kid in a room full of buff veterans. But it’s definitely not the class clown — it’s the quiet topper in HVAC class.
12. Miscellaneous – Shareholding, Promoters
Promoters:
- Mr. Ravalnath Gopinath Shende
- Mrs. Rajashri Ravalnath Shende
- Mrs. Devashree Vishwesh Nampurkar
Promoter Holding:
- Pre-IPO: 56.6%
- Post-IPO: 44.59%
(That ~12% drop includes the Offer for Sale — not alarming, but not nothing either)
Anchor investors took up ~28% of the issue — watch how they behave after August.
13. EduInvesting Verdict™
Shree Refrigerations brings a blend of niche B2B HVAC, high margins, and no shady surprises. But it also comes with a pricing tag that’s more heated than its products. This IPO is all about growth expectations — and if those don’t deliver, even their chillers can’t cool investor tempers.
Final Take:
Strong fundamentals. Cool business. But the valuation? A bit too “summer in Delhi” for comfort.
Metadata:
Written by EduInvesting Team | July 23, 2025
Tags: Shree Refrigerations, IPO, Analysis, EduInvesting Premium
