Indigo Paints IPO review:- Is profitable to invest or not

Indigo paints Ltd is a popular paint in India. It is the fifth-largest company in the paints industry of India. However, Indigo paints IPO is coming soon and People are asking me, We should invest in it or no. Let’s see, Indigo paints IPO review.

Indigo Paints IPO review video is made by Asset yogi. This video is in Hindi voice to understand easily

Indigo paints Limited

Indigo paints Ltd is the fastest growing company in India. This is the fifth-largest company in the paints industry of India. This company is involved in manufacturing different types of decorative paints like enamels, emulsions, wood coatings, primers, distempers, putties, and cement paints.

Indigo was founded in 2020 as the manufacturing of low-cost cement paints with the best quality. However, They have a clear goal of establishing a vast distribution network to extend their reach across India.

In their mission they were successful. Today, Indigo Paints is one of the biggest contenders in the Indian decorative paints landscape.

As the first company in India to produce certain products, they need had an early mover advantage within the markets they’re present in, which has allowed them to understand relatively higher profit margins for these products compared to the remainder of their product portfolio.

However, Indigo paints IPO ( Initial Public Offering ) is coming soon. You should know, the advantages of investing in IPO.

Indigo paints IPO

Let’s know some things about the IPO.

Objects of the Issue

Indigo paints will use the money of IPO allotment from that some are followed below:-

  • To archive the capital expenditure requirements for manufacturing facility development at Pudukkottai, Tamil Nadu
  • To purchase tinting tools, machines, and gyroshakers.
  • To repay all or some borrowings.
  • To satisfy general corporate purposes.
  • Overall aim to grow business faster by allotment money.

Indigo paints IPO Details

IPO Opening DateJan 20, 2021
IPO Closing DateJan 22, 2021
Issue TypeBook Built Issue IPO
Face Value₹10 per equity share
IPO Price₹1488 to ₹1490 per equity share
Market Lot10 Shares
Min Order Quantity10 Shares
Listing AtBSE, NSE
Issue Size[.] Eq Shares of ₹10
(aggregating up to ₹1,176.00 Cr)
Fresh Issue[.] Eq Shares of ₹10
(aggregating up to ₹300.00 Cr)
Offer for Sale5,840,000 Eq Shares of ₹10
(aggregating up to ₹[.] Cr)

An important date for Indigo paints IPO

The Indigo Paints IPO will open on Jan 20, 2021, and close on Jan 22, 2021. The allotment of shares to their investors will be on Feb 2, 2021.

IPO Open DateJan 20, 2021
IPO Close DateJan 22, 2021
Basis of Allotment DateJan 28, 2021
Initiation of RefundsJan 29, 2021
Credit of Shares to Demat AccountFeb 1, 2021
IPO Listing DateFeb 2, 2021

Indigo paints IPO Lot Size

The Indigo Paints IPO market lot size is 10 shares. A retail-individual investor can apply for it. Minimum Lots size is 1 Lot ( 10 shares = ₹14,900 ) 13 lots (130 shares or ₹193,700).

ApplicationLotsSharesAmount (Cut-off)
Minimum110₹14,900
Maximum13130₹193,700

Indigo paints IPO promoters and Holding

The Promoters of this company are Hemant Jalan, Anita Jalan, Parag Jalan, Kamala Prasad Jalan, Tara Devi Jalan and Halogen chemicals private limited.

Pre Issue Share Holding60.05%
Post Issue Share Holding54%

Pros and Cons of Indigo paints

Pros and cons of investing in Indigo paints IPO are as follow by mini-invest

Before investing in IPO we should know the advantages and disadvantages of Indigo paints Ltd. Let’s see,

Pros of Indigo paints

  • Continuously Growth:- The company is growing and Expanding across India. Continuous growth is the biggest strength of Indigo paints. IPL has a track record of consistent growth in a highly competitive decorative paints industry with vital barriers to entry.
  • Brand Equity:- The company has made a very good brand Equity and This company have been focused on building brand equity with continuous growth.
  • Management:- Indigo paints limited management team has a senior professional from the paints industry.
  • Raw material:- Its production facilities are strategically located with closeness to raw materials.
  • Distribution Network:- Catering to a country as vast and diverse as India, Indigo Paints has established an extensive distribution network strategically using the bottom-up approach for better brand penetration.

Cons of Indigo paints

  • Advertisement:- Indigo paints spends much on marketing and advertisement. But, It is much more than the competitors. In 2020, the company spent around 12.7% of its revenue on marketing alone. This can put a strain on its finances in the long-run.
  • Competitors:- Indigo Paints Ltd has some competitors such as Asian paints, Berger paints, Nerolac, and Akzo Nobel. This causes it difficult to grow the company faster.

Financials of Indigo Paints Limited

Here is a quick look at the financial performance of Indigo Paints Limited over the last four years are followed below: all amount are in INR crores

2020201920182017
Total Assets421.96373.18297.39246.17
Total Income626.44537.26403.11290.31
Total Expenses559.01503.25389.24307.89
Profit After Tax47.8226.8712.86-17.58
Long-Term Debt24.7126.918.918.24
This data is founded on groww website

You should know that what are the advantages and disadvantages of investing in IPO

Risk factors

The continuing impact of the COVID-19 pandemic on the business and on their operations is uncertain and it may be significant and proceed to have an adverse effect on its business, operations, and future financial administration.

The company may not be able to identify or effectively respond to evolving preferences, expectations, or trends in a timely manner, and a failure to derive the desired benefits from its product development efforts may impact its competitiveness and profitability.

The company’s ability to grow its business and profit depends on its relationships with dealers and the community of painters. Any unfavorable changes in these relationships, or the company’s inability to enter into new relationships, could negatively affect its business and results of operations.

Indigo Paints does not enter into any long-term agreements with its dealers and relies on renewing the agreement at regular intervals. Any failure in doing so can negatively affect its business and results of operations.

The company is required to obtain, replace, or maintain certain legal and regulatory licenses and approvals necessary to operate its business. If it fails to do so in a timely manner or at all, then its market, financial conditions, results of operations, and cash flows may be negatively affected.

Indigo Paints derives a significant portion of its sales from the state of Kerala. Hence, any adverse developments in that market could adversely impact the company’s business and profitability.

The company relies or depended on third-party transportation providers to ferry the raw materials to the manufacturing facilities and finished products to dealers. Any disorder can impact the business and results of actions.

The decorative paints business is capital-intensive. Hence, if the company experiences insufficient cash flows from its operations or is unable to borrow funds to meet its capital requirements, then it may materially and adversely affect its business and results of operations.

The decorative paints business is subject to seasonal variations and cyclicality that could result in fluctuations in its results of operations.

How to apply in Indigo Paints IPO?

Below are the steps to follow to invest in an Indigo Paints IPO.

  • Firstly, select the right company’s IPOs to invest in them. Do your own study and analysis on it. Understand the company’s business plan, key strengths, performance to date, and purpose to decide wisely.
  • After, studying and get the perfect knowledge about it then you should have a Demat and trading account to apply for it ( If you don’t have this account then open it ).
  • Apply for it through your stockbroker. To apply through your trading account, you need to understand ASBA (Application Supported by Blocked Amount), which is an application that allows banks to block the money in your account at the time of placing bids for IPOs. 
  • The next step is to bid for it. Do bidding according to the list provided by the company.
  • Once the bidding is completed, depending on the investor’s reaction to the IPO, you will be allotted the shares.
  • Once you get a share you can enjoy the returns and gain on investment.

Indigo Paints IPO review

Indigo Paints is a popular brand in the paint industry in India. However, There 4 more competitors in the same industry. It has main factors that continuously grow. Investing in Indigo paints IPO totally depends on you that you want to invest or not.

Indigo Paints IPO FAQs

Why Indigo Paints IPO?

Indigo Paints wants to grow faster and get the needy tools and machine to expansion fast. That’s the reason to publish the Indigo paints IPO.

How is Indigo Paints IPO?

Indigo Paints IPO is best and have good brand Equity. However, The price of 1 share is RS 1490. according to me It is very high for this IPO.

What Should investor do in Indigo Paints IPO?

According to me, We should wait and don’t invest in it for 1 month and then it will clear that In which direction Indigo Paints will go.

Is Indigo Paints IPO good?

According to me, Indigo Paints is good investment with good brand equity. However, I will not recommend to buy it in the IPO.

Is Indigo Paints worth investing?

Yes, Indigo Paints worth investing because, It have some competitive advantages such as Brand Equity, Unique products, and , Marketing. It is the main reason of continent growth.

When will Indigo Paints IPO allotment?

The Indigo Paints allotment date is Jan 28, 2021 and Those you will not get allotment their money will refund on Jan 29, 2021.

When is Indigo Paints IPO listing date?

The Indigo Paints IPO listing date is Fed 2, 2021

What is the Indigo Paints IPO price?

The Indigo Paints IPO is coming soon and the price of each share is RS 1490 and 1 lot size of 10 shares and their price is 14900.

What is the Indigo Paints IPO lot size?

The Indigo Paints IPO lot size is of 10 shares and each share price is 1490.

Conclusion

According to me, Indigo Paints is the best company in the Paints Industry. However, Asian Paints is the king of the paints industry and Indigo Paints Ltd is the second-best company in the paints industry. An important thing to note that is Indigo Paints IPO allotment price is high according to me.

If you have any question related to Indigo Paints then you can ask in the comment box below. Let’s me know in the comment box, what do you think about Indigo Paints IPO.

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