CPS Shapers – SME IPO (Dermawear)

Nice details.

My short thread is as follows:

1. Product is good and is being used by women left and right due to meetings/party/instagram/vlog culture where looks do matter. Plus the same is being recommended by even hospitals too post delivery for tummies.
2. Since CPS shapers is focusing on this particular segment only, it has first mover advantage as these kind of products have their own learning curve to make it perfect.
3. Financial growth looks good and in fact is expected little fast once textile sector bottoms out.
4. Company is now focusing on exports too so that will add the topline.
5. An interesting piece of information from their DRHP is
   To cater to the growing demand from our existing customers and to meet requirements of new customers, we intend to expand and upgrade our manufacturing capacities for existing products that we are in the process of developing and commercializing. We intend to increase our production capacity by way of installation of new plant and machineries atour existing manufacturing facility. We believe our investment in this plant and machineries will add on to our current installed capacity, thus, enabling us to cater to the growing demand from our customers and add new products in our
   existing product portfolio. This shall help us cater to expand our customer base and increase our revenue from operations.

Our Company aims to expand and diversify our product portfolio by increasing its product base and introducing new range of product lines. We plan to continue expanding our manufacturing capabilities in order to capture future growthtrends. We intend to explore opportunities to expand our operations by developing new products and services within ourexisting lines of business. Further expanding our service offerings will help us to build on existing diversification of our business. We believe that maintaining a variety in range of products in our business provides us with an opportunity to
cater to diverse needs of different customer segment.

Anti thesis

1. Only one negative point i found so far is that Debt to equity ratio is 5 approx. which is high.
2. The business has no MOAT although there will be a learning curve for newcomers and CPS will always have first mover advantage by then.

Disc: Invested and biased