Mehta Equities Ltd has issued a “Subscribe” recommendation for Mamata Machinery Ltd’s initial public offering (IPO), citing the company’s strong position in the packaging machinery industry and promising long-term growth potential. The IPO, priced at ₹243 per share at the upper price band, values the company at ₹598 crore and comprises a 100 per cent Offer for Sale (OFS) worth ₹179.39 crore, raising concerns about no direct benefit to the company from the proceeds.
Mamata Machinery is a key player in automated packaging solutions, with a global footprint across the USA, Europe, Latin America, and the Middle East. It caters to high-demand sectors such as FMCG, food, pharmaceuticals, and e-commerce, leveraging its focus on innovation and sustainable packaging machinery.
The company’s financials reflect stable growth, with revenue rising 17.8 per cent in FY24 and net profit surging 60.5 per cent, supported by strong operational efficiency. Its valuation, based on a PE ratio of 14.65x for FY25 annualized earnings, is deemed reasonable given its market positioning and growth outlook.
Mamata’s emphasis on recyclable and biodegradable materials aligns with global sustainability goals, while its integration of IoT-enabled systems and energy-efficient technologies enhances cost-effectiveness and performance. State-of-the-art manufacturing facilities and a robust R&D infrastructure ensure precision and quality compliance for regulated markets.
However, Mehta Equities flagged the 100 per cent OFS structure as a potential concern for new investors, as no fresh capital will be infused into the company. Despite this, the brokerage highlighted Mamata’s strong customer relationships, extensive global distribution network, and focus on after-sales service as key factors enabling repeat business and brand trust.
Mehta Equities believes Mamata Machinery is well-positioned to capitalize on the growing demand for automation and flexible packaging solutions, recommending investors subscribe for a long-term perspective. The IPO is seen as a reasonable entry point into a sector poised for sustained growth.
