Anand Rathi IPO opens today: Anil Singhvi says expect small listing gain, apply for long-term

Anand Rathi Wealth IPO is opening for a public subscription from Thursday, December 2, 2021. The three-day Rs 660-crore initial public offer will conclude on December 6, 2021. Anand Rathi Wealth has fixed a price band of Rs 530-550 per share for the IPO.  The initial share sale is entirely an offer for sale (OFS) of 1.2 crore equity shares by promoters and existing shareholders.    

The OFS consists of the sale of 92.85 lakh equity shares by Anand Rathi Financial Services, and 3.75 lakh equity shares each by Anand Rathi, Pradeep Gupta, Amit Rathi, Priti Gupta, Supriya Rathi, Rawal Family Trust, and Feroze Azeez, and 90,000 equity shares by Jugal Mantri.  

The issue includes a reservation of 2.5 lakh equity shares for employees.    

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Speaking of negatives, he said Anand Rathi Wealth caters to highly competitive business< which is dependent on market conditions.  

Earlier, two more IPO opened this week—Rakesh Jhunjhunwala-backed Star Health and Allied Insurance Co. Ltd to Tega Industries IPO

What Expert, Brokerage Say?  

Marwadi Shares and Finance Limited has also given a subscribe rating for this IPO.    

The brokerage house said the company is one of the leading non-bank mutual fund distributors in India with a presence in Non-Convertible Market Linked Debentures and is available at reasonable valuations as compared to its peer. "Considering the FY-22 annualized EPS of Rs.29.46 on the post-issue basis, the company is going to list at a P/E of 18.67x with a market cap of Rs.22,889 mn, while its peer namely IIFL Wealth Management is trading at P/E of 24.59x (FY22 annualized). We assign a “Subscribe” rating to this IPO."  

"Apply only if it is oversubscribed on the final day, with the majority being NII and anchor investors," said Manoj Dalmia, founder and Director, Proficient equities Private limited  
IPO Details

About the IPO, at the upper end of the price band, the initial share sale is expected to fetch Rs 660 crore.  Half of the issue size has been reserved for qualified institutional buyers (QIBs), 15 per cent for non-institutional investors, while 35 per cent has been set aside for retail investors.  

The Investors can bid for a minimum of 27 equity shares and in multiples of thereafter.

Anand Rathi Wealth operates in the financial services industry with a focus on mutual fund distribution and the sale of financial products. The company commenced activities in fiscal 2002 and is AMFI registered mutual fund distributor.