Vasa Retail – FY18 results analysis

Analysis of Vasa Retail results
Revenues of INR35cr and Profit after Tax (PAT) of INR1.42cr for FY18. Corresponding figures for FY17 – INR23.85cr and INR0.92cr. 46.57% YoY growth in Revenues and 54.34% YoY growth in PAT. EBITDA margins FY18 5.8% and  FY17 5.5%. One off expenses included IPO related expenses and bank shifting charges of INR0.65cr, adjusting for that EBITDA margins for FY18 stand at INR7.5%
Hardly any long term debt (INR0.33cr) . everything is short term (INR9.36cr) which is rolling, used for working capital. Cash equivalents of INR1.18cr.
While analysing, do note that company has recently shifted its business model to inventory based, demand forecasting from made to order. So a lot of IPO money (received only in February 2018, less than 90 days towards year ended March 2018) has gone into keeping stocks ready and ordering, etc. Hence the trade payables (INR9.75cr) and trade receivables (INR11.40cr) are high. 
So to update my short note elucidated below . We have a company placed in an industry of 10,000cr (only India), growing at 6%. 90%+ is unorganised and seeing a strong shift from unorganised to organised after GST. Revenues/PAT FY17 INR23.85cr/0.92cr, FY18 INR35cr/1.42cr. Market cap ONLY 30cr. Available at less than 1x sales. This is all when Oxford is not even properly baked in and Indian opportunity size is huge. Middle East can be massive, which is already 30-40% of revenues. 
Price when posted – INR46.5 (30May2018). Market cap – INR28cr.

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