Tega Industries Ltd. IPO

Tega Industries Ltd. IPO - SWOT Analysis

Strengths:

The company is a major manufacturer of specialised and "essential to run" items with significant replacement and substitute barriers. It is immune to mining capex cycles because its products cater to after-market spending, resulting in recurrent revenues.

Weaknesses:

The sole purpose of this IPO is to sell shares (OFS). The profits of the IPO would go to the selling shareholders under OFS, and the firm would receive no money. Because this is the primary purpose of the IPO, the company will not receive any new funds and will only benefit from listing gains. Failure to build or properly manage a company's sales and distribution network, both in India and beyond, can have a negative impact on its business. For the delivery of raw materials and final goods, the company relies on third-party logistic and support service providers. Any interruption may cause a negative impact on the company's operations.

Opportunities:

Long-standing market participant with a prestigious global customer base and excellent manufacturing and sales skills on a global scale. The company has had sustained expansion, which has been distinguished by operational efficiency and a high level of repeat business.

Threats:

The company relies on a small number of essential raw material suppliers and does not have long-term contracts with them. The company, its promoters, and directors are involved in legal procedures, and a negative decision in any of these processes might have a negative impact on the company's operations, financial situation, and growth strategy. Before participating in this IPO, investors should read all of the risk considerations listed in the RHP of the IPO document.