Aditya Birla Sun Life Asset Management Company (ABSL) is opened its initial public offering (IPO) on Wednesday. The corporate plans to shut the problem after three subscription days on October 1, 2021. The non-bank affiliated asset administration firm has mounted its IPO value at Rs 695 to Rs 712 per fairness share with a Rs 5 per fairness share because the face worth. The general public situation is an entire supply on the market (OFS) of Rs 2,768.26 crore with a complete of 38,880,000 fairness shares by promoting shareholders. The Object of the IPO is to make use of the online proceeds from the problem to realize the advantages of itemizing the fairness shares on the Inventory Exchanges in addition to perform the OFS. As this situation is totally an OFS, the corporate won’t immediately obtain any proceeds from the IPO. All proceeds will go to the promoting shareholders. Talking on the expansion of the corporate, Anandrathi Broking mentioned in a be aware, “The corporate is dedicated to rising its geographic attain by each increasing its distribution community and deepening its present presence. It intends to proceed to extend its footprint throughout India by specializing in rising its presence in B-30 cities and rural markets that stay underpenetrated and have much less competitors.”
Aditya Birla Solar Life AMC IPO: Firm Strengths
The Aditya Birla Solar Life AMC is among the largest non-bank affiliated asset administration firms in India. It has maintained a place as the most important non-bank affiliated AMC in India in keeping with its Quarterly Common Belongings Below Administration (QAAUM) since March of 2019. It was additionally ranked one of many 4 largest AMCs in India by QAAUM in September of 2011.
It’s also a well-recognised and trusted model with skilled promoters. Talking of which, the promoters for the corporate on this IPO are Aditya Birla Capital Restricted (ABCL) and Solar Life (India) AMC Investments Inc. Thanks to those trusted names and the expertise that comes with it construct plenty of belief with its prospects in the long run. The corporate can also be dedicated to rising its particular person investor buyer base by sturdy systematic flows and B-30 Penetration. It’s also has a really various product portfolio with fund efficiency supported by a research-driven philosophy.
Aditya Birla Solar Life AMC IPO: Key Dangers
The consequences of the pandemic left the way forward for the corporate in a state of uncertainty by way of the enterprise. Any drastic modifications within the Belongings Below Administration (AUM) might end result within the decline of the general income and revenue of the corporate. One other concern is the underperformance of funding merchandise, which may result in a lack of traders and subsequently lack of AUM and impacted operations.
Aditya Birla Solar Life AMC IPO: Pricing
The corporate has a hard and fast value band of Rs 695 to Rs 712 per fairness share with Rs 5 per fairness share because the face worth. “On the higher finish of the IPO value band, Aditya Birla Solar Life AMC Ltd. is obtainable at P/E of 39x its FY21 earnings, with a market capitalization of Rs 205,056 million,” mentioned Anandrathi Broking.
Aditya Birla Solar Life AMC IPO: GMP
The problem confirmed as having a gray market premium of Rs 45 on September 29, in keeping with data on IPO Watch. This indicated that the shares have been buying and selling at a premium of Rs 740 to Rs 757 per fairness share on the unlisted gray market.
Must you Subscribe to Aditya Birla Solar Life AMC IPO?
Established in 1994, the corporate is a three way partnership between among the most trusted names within the business, i.e., Aditya Birla Capital Restricted (ABCL) and Solar Life (India). It’s also thought-about for its progressive and buyer ahead method because it dedicates its sources to aggressive growth.
Broking firms are recommending a ‘Subscribe’ ranking for the problem on the again of sturdy development prospects of the AMC and as a result of elements of its massive firm dimension, rising particular person investor buyer base, buoyant capital market and so forth.
Talking on this, Jyoti Roy – DVP- Fairness Strategist of Angel One Ltd mentioned, “Aditya Birla AMC has witnessed a gradual development in AUM since 2016 and has additionally been always growing the share of Particular person AUM throughout the combine. Furthermore, the share of excessive margin Fairness AUM has normalized to 36.5% of AUM in Q1FY2022 as in comparison with 30.5% of AUM from 30.5% of AUM on the finish of FY2020. On the increased finish of the value band the AMC can be buying and selling at Market/AUM of seven.3xQ1FY22 Avg. AUM which is at a reduction to Nippon Life AMC and at an identical degree to that of UTI AMC. Given the low cost to Nippon AMC and robust development prospects of the AMC as a result of a buoyant capital market we’d suggest to SUBSCRIBE to the IPO.”