Valuation of Gravita India (new IPO) vs Pondy Oxide

We came across the IPO document of Gravita India. It is one of the major competitor to Pondy Oxide and both are operating an identical business. Interestingly, Gravita despite being a smaller company when compared to Pondy, is going public at more than 3 times the valuations commanded by already listed Pondy Oxide.

Here is a quick comparison sheet to highlight the huge valuation gap between two companies:

Comparison sheet    
Pondy Oxide Gravita India
Capacity (MT) 32000 24000
Standalone Turnover 158 105
Standalone NP 5.8 5.77
PE Ratio 7 22
Consolidated Turnover 232 159
Consolidated NP 12.31 13.23
PE Ratio 3.25 9.5
M Cap 40 170
1. Capacity is calculated on Standalone basis and
addition of various sub-segments    
2. M Cap of Gravita is based on price at upper band  

As highlighted by Gravita in its various articles and documents, the lead recycling business has great potential due to strong battery demand, we feel Pondy Oxide is a much better bet when compared to Gravita as the valuations are very attractive in Pondy Oxide.

With the IPO of Grativa opening tomorrow, investors will get more informed about this sector and might discover the undervaluation in Pondy Oxide.
Gravita India Website | Pondy Oxide Coverage