Mehul Telecom SME IPO Review | APPLY or AVOID?
Mehul Telecom Ltd. started in May 2023. It operates in the multi-brand mobile and electronic retail industry and provides smartphones and accessories to its customers across Gujarat. This business is based in Rajkot. This IPO review covers the main facts of the offer. It helps you decide if the issue fits your portfolio.
Mehul Telecom Ltd. shows Rapid growth, but the unsustainable jump in profits from FY25 remains a key concern for investors. The company operates in a competitive, fragmented retail segment. Well-informed investors with surplus cash and an appetite for risk might consider parking some funds for the medium term.
IPO Details | |
|---|---|
| Issue Type | Book Building |
| IPO Category | SME |
| Face Value | ₹10 Per Share |
| Fresh Issue | ₹27.73 Cr. |
| Offer for Sale | – |
| Listing At | SME |
Reservation & Lot Size | |
|---|---|
| Retail (Min) | 2 Lot | 2,400 Shares | ₹2,35,200 |
| Retail (Max) | 2 Lot | 2,400 Shares | ₹2,35,200 |
| S-HNI (Min) | 3 Lot | 3,600 Shares | ₹3,52,800 |
| S-HNI (Max)| 8 Lot | 9,600 Shares | ₹9,40,800 |
| B-HNI (Min) | 9 Lot | 10,800 Shares | ₹10,58,400 |
| Market Maker | 1,44,000 Shares | ₹1 Cr |
✅ Strengths
⚠️ Challenges
Financial Update
The company released its restated financial statements for the year ending March 31, 2025. Total revenue was ₹121.02 crore, an increase from ₹107.37 crore in the previous year. The net profit for the same period was ₹6.04 crore, an increase from ₹2.19 crore in the previous year. Assets increased by -% compared to the previous year. The company has shown strong revenue growth over the last three fiscal years. However, the large jump in net profit from FY25 onwards raises questions about its true operational efficiency. This sudden profit increase may be window dressing to secure a higher IPO valuation. This trend should be carefully studied prior to any investment.
IPO Valuation
The upper price band is ₹98. This price yields a Price-to-Earnings (P/E) ratio of 16.96 based on FY25 earnings and 10.86 based on FY26 annualized earnings. The industry’s average P/E is 16.47 (peers’ averages: 13.0, 15.8, and 20.6). The issue price is high compared to its historical earnings. The aggressive pricing seems to be based on recent bumper profits, possibly inflated. Investors should be cautious about sustaining these high margins in the future.
IPO Objective
The company will use the proceeds of the offer to meet stated objectives:
Promoters & Lead Manager
Peer Comparison
Below is a comparison of the company with its listed peers, based on data from April 10, 2026. Fonebox Retail, Jay Jalaram Techno, and Bhatia Communications are cited as peers. These companies are not fully comparable in terms of business size or product mix. Relying solely on this comparison for investment decisions is not advisable.
| Company | EPS (Basic) | EPS (Diluted) | NAV (₹ per share) | RoNW (%) | P/BV Ratio | Financial Statements |
|---|---|---|---|---|---|---|
| Mehul Telecom | 8.30 | 8.30 | 23.49 | - | - | Standalone |
| Fonebox Retail | 4.43 | 4.43 | 33.62 | - | - | Standalone |
| Jay Jalaram Technologies | 2.87 | 2.87 | 56.81 | 14.45 | 1.94 | Standalone |
| Bhatia Communications & Retail (India) | 1.10 | 1.10 | 7.08 | 17.13 | 1.61 | Standalone |
| 18.94 | 2.86 | - | ||||
Financial data sourced from annual reports and stock exchange data, using restated financial statements for 2024-25. NAV per share (closing net worth divided by weighted average number of paid-up equity shares) and RoNW (net profit after tax divided by closing net worth).
IPO Review & Analyst Rating
Mehul Telecom mainly sells a range of mobile phones and other electronic brands. Selling mobile phones accounts for most of their revenue (more than 97% of their yearly sales). The company has been earning more money (revenue) and making higher profits. However, the big jump in profits starting from the year FY25 is a bit worrying. This sudden profit increase might be a way to make the company look more valuable before its initial public offering (IPO). The company operates in a highly crowded, competitive retail market. Because of this, only investors who have good information, extra cash, and are okay with taking a moderate risk should think about investing for a few years.
| Analyst Name | Recommendation |
|---|---|
| – | – |
| – | – |
| – | – |
Disclaimer: The information on the site is informational only. The contents of this blog are not financial advice. You should not invest in any stock market instrument without consulting your Financial advisor.
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