According to CNBC-TV18 analyst Sajeet Manghat, it is going to be a blockbuster listing for Edelweiss on Wednesday. The issue is priced at Rs 825, he informed.
Manghat informed that the entire size of the issue was Rs 692 crore and the issue was subscribed 111 times, with HNI portion being subscribed 164 times and QIB portion 153 times. According to him, the HNI premium comes to around 625 to 750, while the grey market pricing for Edelweiss is around 800.
So, at Rs 1,600, Edelweiss has a market cap of nearly 13,000 crore; which means a market cap to sales of 24 times for FY08 and nearly 16 times for FY09, as compared to its peers like Indiabulls, which has a market cap to sales of 5.7 times FY09 and Motilal Oswal which has a 6.9 times market cap to sales, Manghat pointed out.
He added that the company is expected to post revenue of nearly Rs 540 crore for FY08 and nearly Rs 785 crore for the next fiscal with profit of Rs 196 crore this year and Rs 290 crore next year. This, according to Manghat means that one is looking at a PE at 1,600 or 45 times for Edelweiss, as compared to its peers Indiabulls, which has a PE of 15 times FY09 and Motilal Oswal, which has it at 27.6 times FY09.
The CNBC-TV18 analyst concluded that Edelweiss is slightly expensive as compared to its peers, but it is going to be a blockbuster listing for Edelweiss on Wednesday.
Source: Moneycontrol.com
Showing posts with label Edelweiss Capital IPO. Show all posts
Showing posts with label Edelweiss Capital IPO. Show all posts
Tuesday, December 11, 2007
Tuesday, November 20, 2007
Edelweiss Capital IPO subscribed 110 times
The initial public offer (IPO) of Edelweiss Capital, a diversified financial services company, has received overwhelming response. The issue has subscribed 109.8 times till 5 pm, according to data available on NSE website.
It has received bids for 92 crore equity shares as against 8,386,147 equity shares of Rs 5 each on offer.
According to sources, qualified institutional investors and non institutional investors have given strong support to the issue, their reserved portion subscribed 125 times each followed by retail with 10 times subscription.
The price band has been fixed between Rs 725 and Rs 825 per equity share of face value Rs 5.
The proceeds of the issue will be used, inter alia, towards enhancement of margin maintenance with stock exchanges, establishment of additional offices and acquisition of office infrastructure, enhancement of existing technological capacity and loan prepayment.
Edelweiss Capital provides investment banking, institutional equities, private client broking, asset management, wealth management, insurance broking and wholesale financing services to corporate, institutional and high net worth individual clients.
The book running lead managers to the issue are Kotak Mahindra Capital Company Limited, Citigroup Global Markets India Private Limited and Lehman Brothers Securities Private Limited.
Courtesy: Moneycontrol.com
It has received bids for 92 crore equity shares as against 8,386,147 equity shares of Rs 5 each on offer.
According to sources, qualified institutional investors and non institutional investors have given strong support to the issue, their reserved portion subscribed 125 times each followed by retail with 10 times subscription.
The price band has been fixed between Rs 725 and Rs 825 per equity share of face value Rs 5.
The proceeds of the issue will be used, inter alia, towards enhancement of margin maintenance with stock exchanges, establishment of additional offices and acquisition of office infrastructure, enhancement of existing technological capacity and loan prepayment.
Edelweiss Capital provides investment banking, institutional equities, private client broking, asset management, wealth management, insurance broking and wholesale financing services to corporate, institutional and high net worth individual clients.
The book running lead managers to the issue are Kotak Mahindra Capital Company Limited, Citigroup Global Markets India Private Limited and Lehman Brothers Securities Private Limited.
Courtesy: Moneycontrol.com
Saturday, November 17, 2007
Subscribe to Edelweiss with medium term view
Keynote Capitals has come out with report on Edelweiss Capital IPO. The firm has advised to subscribe the issue with medium term view.
Edelweiss Capital, a diversified financial services company, has opened for subscription with its initial public offering (IPO) of 8,386,147 equity shares of Rs 5 each for cash, at a price to be decided through a 100% book building process.
The issue will close close on November 20, 2007. The price band is between Rs 725 and Rs 825 per equity share of face value Rs 5.
Keynote Capitals report on Edelweiss Capital IPO
Recommendation - Subscribe with a medium term view
* Edelweiss Capital (ECL) is a diversified financial services company in India offering services to corporate, institutional and high-net-worth clients. It operates from 43 offices in 19 Indian cities. Strong, professional management.
* It operates through various subsidiaries to offer a wide spectrum of services. Impressive track record since inception in 1995. Topline and bottomline grew at a CAGR of 130% and 142% respectively during FY04-07.
* Bottomline growth mainly on account of expanding EBITDA margin, up from 46.3% in FY04 to 52.6% in FY07. Higher margin attributable to revenues from proprietary trading, institutional clients and investment banking. Its investment banking division has been scaling up operations, successfully lead managed IPOs of MIC Electronics, Meghmani Organics, C & C Construction etc.
* The IPO is aimed primarily at meeting margin money requirements indicating strong growth in the clientele base.
* ECL’s cash balance as of August 2007 stood at Rs 994 crore. In spite of the huge cash on its books, it is raising money primarily to have adequate liquidity and also for prepayment of loan of Rs 105 crore.
* When compared with peers MOFSL and Religare (which went public recently), across a few key parameters, ECL comes across as a mixed bag.
* EBITDA margin superior vis-à-vis that of MOFSL and Religare (32% and 37% respectively).
* MOFSL and Religare have presence in both institutional and retail segments. ECL, however, does not have much presence in the retail segment.
* ROE declined from 42.8% in FY05 to 18.8% in FY07 due to the expansion in net worth, attributable to the issue of preference share capital. However, in spite of this, ROE is on par with that of MOFSL and Religare.
* Broking income constituted 58.4% of ECL’s FY07 revenues; vis-à-vis 87% and 50%% for MOFSL and
Religare respectively. For ECL, income from arbitrage and trading constituted as much as 31% of FY07 revenues. We find the bias towards arbitrage and trading revenues to be a matter of concern.
* Lower leverage and higher interest coverage than that of Religare (however, ECL’s interest cost has increased substantially during the period of 5 months to August 31, 2007, due to sharp increase in debt.
* Reduction in promoter/group stake to just 35%, post-IPO is also a concern.
* Pre-IPO placements to Galleon Special Opportunities Master Fund, Sequoia Capital India and promoters in August, 2007 @ Rs514/517 per share, the last reflecting a discount of 60% to the IPO cap price.
* In line with expected growth in operations, we expect topline and bottomline growth CAGR of 70.3% each during FY07-09. As per our estimates, ECL’s IPO valuation (36.8xFY08E and 21.3x FY09E) is somewhere in between that of MOFSL (39.7xFY08E and 28.4xFY09E) and Religare (22.6xFY08E and 14.4xFY09E). However, in view of strong promoter background and brand equity, we recommend subscribing with a medium term view.
Investment Concerns
* Downturns or disruptions in securities markets could reduce transaction volumes, causing a decline in business. Revenues from operations arise largely during bullish phase in equity market which is not a consistent phenomenon.
* The subsidiary ESL was barred by securities regulators from dealing in securities of certain Indian companies in the past. ECL derives significant business from ESL, any effect in its operations shall affect the consolidated numbers.
* The subsidiary Edelweiss Capital USA LLC is into losses to the tune of Rs 0.09 crore as of August 31, 2007.
* Asset management, investment advisory, financing and wealth management are new businesses in which ECL has recently forayed. It does not have lot of experience in this field.
* There are conflicts of interest within promoter and promoter group. They have equity interests in other entities namely Ivy Financial Services Pvt Ltd and E Cap Partners.
Source: Moneycontrol.com
Edelweiss Capital, a diversified financial services company, has opened for subscription with its initial public offering (IPO) of 8,386,147 equity shares of Rs 5 each for cash, at a price to be decided through a 100% book building process.
The issue will close close on November 20, 2007. The price band is between Rs 725 and Rs 825 per equity share of face value Rs 5.
Keynote Capitals report on Edelweiss Capital IPO
Recommendation - Subscribe with a medium term view
* Edelweiss Capital (ECL) is a diversified financial services company in India offering services to corporate, institutional and high-net-worth clients. It operates from 43 offices in 19 Indian cities. Strong, professional management.
* It operates through various subsidiaries to offer a wide spectrum of services. Impressive track record since inception in 1995. Topline and bottomline grew at a CAGR of 130% and 142% respectively during FY04-07.
* Bottomline growth mainly on account of expanding EBITDA margin, up from 46.3% in FY04 to 52.6% in FY07. Higher margin attributable to revenues from proprietary trading, institutional clients and investment banking. Its investment banking division has been scaling up operations, successfully lead managed IPOs of MIC Electronics, Meghmani Organics, C & C Construction etc.
* The IPO is aimed primarily at meeting margin money requirements indicating strong growth in the clientele base.
* ECL’s cash balance as of August 2007 stood at Rs 994 crore. In spite of the huge cash on its books, it is raising money primarily to have adequate liquidity and also for prepayment of loan of Rs 105 crore.
* When compared with peers MOFSL and Religare (which went public recently), across a few key parameters, ECL comes across as a mixed bag.
* EBITDA margin superior vis-à-vis that of MOFSL and Religare (32% and 37% respectively).
* MOFSL and Religare have presence in both institutional and retail segments. ECL, however, does not have much presence in the retail segment.
* ROE declined from 42.8% in FY05 to 18.8% in FY07 due to the expansion in net worth, attributable to the issue of preference share capital. However, in spite of this, ROE is on par with that of MOFSL and Religare.
* Broking income constituted 58.4% of ECL’s FY07 revenues; vis-à-vis 87% and 50%% for MOFSL and
Religare respectively. For ECL, income from arbitrage and trading constituted as much as 31% of FY07 revenues. We find the bias towards arbitrage and trading revenues to be a matter of concern.
* Lower leverage and higher interest coverage than that of Religare (however, ECL’s interest cost has increased substantially during the period of 5 months to August 31, 2007, due to sharp increase in debt.
* Reduction in promoter/group stake to just 35%, post-IPO is also a concern.
* Pre-IPO placements to Galleon Special Opportunities Master Fund, Sequoia Capital India and promoters in August, 2007 @ Rs514/517 per share, the last reflecting a discount of 60% to the IPO cap price.
* In line with expected growth in operations, we expect topline and bottomline growth CAGR of 70.3% each during FY07-09. As per our estimates, ECL’s IPO valuation (36.8xFY08E and 21.3x FY09E) is somewhere in between that of MOFSL (39.7xFY08E and 28.4xFY09E) and Religare (22.6xFY08E and 14.4xFY09E). However, in view of strong promoter background and brand equity, we recommend subscribing with a medium term view.
Investment Concerns
* Downturns or disruptions in securities markets could reduce transaction volumes, causing a decline in business. Revenues from operations arise largely during bullish phase in equity market which is not a consistent phenomenon.
* The subsidiary ESL was barred by securities regulators from dealing in securities of certain Indian companies in the past. ECL derives significant business from ESL, any effect in its operations shall affect the consolidated numbers.
* The subsidiary Edelweiss Capital USA LLC is into losses to the tune of Rs 0.09 crore as of August 31, 2007.
* Asset management, investment advisory, financing and wealth management are new businesses in which ECL has recently forayed. It does not have lot of experience in this field.
* There are conflicts of interest within promoter and promoter group. They have equity interests in other entities namely Ivy Financial Services Pvt Ltd and E Cap Partners.
Source: Moneycontrol.com
Tuesday, November 13, 2007
Apply for Edelweiss Capital IPO
SKP Securities has come out with a report on Edelweiss Capital IPO. Based on a strong outlook for the Indian economy, and growing investment banking business, the firm has recommended subscribe to the issue.
Edelweiss Capital, a diversified financial services company, is entering the capital market with its initial public offering (IPO) of 8,386,147 equity shares of Rs 5 each for cash, at a price to be decided through a 100% book building process.
The issue will open on November 15, 2007, and will close on November 20, 2007. The price band has been fixed between Rs 725 and Rs 825 per equity share of face value Rs 5.
SKP Securities report on Edelweiss Capital IPO
Investment Highlights:
Edelweiss Capital (ECL) is a diversified financial services company in India, providing investment banking, institutional equities, private client broking, asset management and investment advisory services, wealth management, insurance broking and wholesale financing services to corporate, institutional and high net worth individual clients.
Key strengths:
An integrated financial services platform: ECL’s integrated service platform allows it to leverage relationships across lines of businesses by providing multi-channel delivery systems to its client base, thereby increasing its ability to cross-sell various services.
Research driven approach: ECL have a strong research platform consisting of fundamental and alternative research, catering to institutional and high net worth individual investors. Fundamental research covers approximately 190 companies, which represent approximately 69% of the market capitalization of all companies listed on the BSE. ECL's strength lies in identifying emerging investment themes that will drive economic activity, investments, growth and profitability of companies and showcasing them to its clients.
The objects of the issue are:
Enhancement of margin maintenance with Exchanges,
Establishment of additional offices and acquisition of office infrastructure,
Enhancement of existing technological capacity,
Prepayment of loans
Financial Performance (Consolidated) Uses and Source of Funds
Concerns:
* ECL’s business is highly dependent on the capital market. About 58% of the company’s income comes from institutional broking and investment banking businesses, followed by 31% from treasury operations. Difficult market conditions can adversely affect the business of ECL.
* ECL is subject to extensive securities regulation and any failure to comply with these regulations may lead to imposition of penalties or sanctions.
Recommendation:
ECL is an established brand and has a strong network of investor relationships. Based on a strong outlook for the Indian economy, and growing investment banking business, we recommend Subscribe to the issue.
Courtesy: moneycontrol.com
Edelweiss Capital, a diversified financial services company, is entering the capital market with its initial public offering (IPO) of 8,386,147 equity shares of Rs 5 each for cash, at a price to be decided through a 100% book building process.
The issue will open on November 15, 2007, and will close on November 20, 2007. The price band has been fixed between Rs 725 and Rs 825 per equity share of face value Rs 5.
SKP Securities report on Edelweiss Capital IPO
Investment Highlights:
Edelweiss Capital (ECL) is a diversified financial services company in India, providing investment banking, institutional equities, private client broking, asset management and investment advisory services, wealth management, insurance broking and wholesale financing services to corporate, institutional and high net worth individual clients.
Key strengths:
An integrated financial services platform: ECL’s integrated service platform allows it to leverage relationships across lines of businesses by providing multi-channel delivery systems to its client base, thereby increasing its ability to cross-sell various services.
Research driven approach: ECL have a strong research platform consisting of fundamental and alternative research, catering to institutional and high net worth individual investors. Fundamental research covers approximately 190 companies, which represent approximately 69% of the market capitalization of all companies listed on the BSE. ECL's strength lies in identifying emerging investment themes that will drive economic activity, investments, growth and profitability of companies and showcasing them to its clients.
The objects of the issue are:
Enhancement of margin maintenance with Exchanges,
Establishment of additional offices and acquisition of office infrastructure,
Enhancement of existing technological capacity,
Prepayment of loans
Financial Performance (Consolidated) Uses and Source of Funds
Concerns:
* ECL’s business is highly dependent on the capital market. About 58% of the company’s income comes from institutional broking and investment banking businesses, followed by 31% from treasury operations. Difficult market conditions can adversely affect the business of ECL.
* ECL is subject to extensive securities regulation and any failure to comply with these regulations may lead to imposition of penalties or sanctions.
Recommendation:
ECL is an established brand and has a strong network of investor relationships. Based on a strong outlook for the Indian economy, and growing investment banking business, we recommend Subscribe to the issue.
Courtesy: moneycontrol.com
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