The public issue of Prudent Corporate Advisory Services has received bids for 34.04 lakh equity shares against an offer size of 60.18 lakh equity shares, subscribing 57 percent on May 11, the second day of bidding.
Retail investors have bought 105 percent of the allotted quota and employees bid for 67 percent shares of the reserved portion.
The part set aside for non-institutional investors has been booked 19 percent, while qualified institutional buyers have purchased 966 equity shares against 16.87 lakh shares set aside for them.
The maiden public issue, which will fetch the retail wealth management services provider Rs 538.6 crore, comprises only an offer-for-sale of 85.49 lakh equity shares by Wagner, an affiliate of TA Associates, and Shirish Patel.
Wagner, which will sell 82.81 lakh equity shares through this offer, held 40 percent equity stake (1.65 crore shares) in the company.
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The offer includes a reservation of Rs 6.5 crore worth of shares for employees. The price band for the offer is set at Rs 595-630 apiece.
"At the upper end of the IPO price band, Prudent Corporate Advisory Services is offered at a price-to-earnings (P/E) ratio of 33.9x its FY22 annualised earnings, with a market capitalisation of Rs 2,608.6 crore," said Anand Rathi.
It said that the IPO is richly priced. "The company will have to continue growing its business at a high growth rate in order to justify the valuations. Hence, we give the IPO a 'subscribe (long term)' rating," said the brokerage.
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It said the company has a scalable and asset-light model in a high-growth underpenetrated Indian asset management industry with diversified distribution network. The company, which reported a return on net worth of 28.73 percent in FY21, is among the top mutual fund distributors in terms of average assets under management (AAUM) and commission received.
Prudent Corporate Advisory Services, an independent retail wealth management services group in India, had assets under management from the mutual fund distribution business (AUM) at Rs 48,411.5 crore with 92.14 percent of its total AUM being equity oriented. Its AUM has increased at a CAGR of 33 percent during FY18 and 9MFY22.
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