Prudent Corporate Advisory Services opens today: Apply or skip - What should investors do? Anil Singhvi explains

Prudent Corporate Advisory Services IPO: Initial public offering (IPO) of Prudent Corporate Advisory Services is all set to open on Monday, May 10. The three-day public issue of Retail wealth management firm will close on May 12. The company, which has fixed a price band of Rs 595-630 per share, aims to raise around Rs 538.61 crore at the upper end of the price band via IPO. 

The initial share-sale of 85,49,340 equity shares comprises an offer of sale of 82,81,340 equity shares by Wagner Ltd and up to 2,68,000 equity shares by Shirish Patel. 

Half of the issue size has been reserved for qualified institutional buyers (QIBs), 15 per cent for non-institutional investors and 35 per cent for retail investors. Besides, equity shares aggregating up to Rs 6.5 crore have been reserved for employees. Investors can bid for a minimum of 23 shares and in multiples thereof. 

Ahead of the IPO, Prudent Corporate Advisory Services on raised a little over Rs 159 crore from anchor investors ahead of its initial share sale, as per the exchange data. 

As the issue opens today, what should investors do?  

Zee Business Managing Editor Anil Singhvi was of the view that one should not apply in this IPO with listing gain view. He suggested avoiding the issue if one is looking at Prudent Corporate Advisory Services IPO from listing gain point of view.  

"Given the current market sentiments, one should buy the shares post listing. "Only high-risk taking investors should apply for the issue with long-term view," said Singhvi.  

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In line with Anil Singhvi views, Marwadi Financial Services also recommended avoiding this IPO.  

#PrudentCorporateAdvisory IPO:

आज खुल रहा प्रूडेंट कॉरपोरेट एडवाइजरी सर्विसेज का IPO

प्राइस बैंड: ₹595-630/शेयर

क्या है पॉजिटिव और कहां है जोखिम?

इश्यू सब्सक्राइब करें या छोड़ दें?

जानिए अनिल सिंघवी से...@AnilSinghvi_ | #IPOAlert pic.twitter.com/TGWtTssqLb

— Zee Business (@ZeeBusiness) May 10, 2022

"Considering the FY21 / FY22 (Annualised) EPS of Rs.10.94/Rs.18.56 on a post issue basis, the company is going to list at a P/E of 57.59x/33.95x with a market cap of Rs.26,086 mn whereas its peers namely IIFL Wealth Management and ICICI Securities are trading at PE of 27.3x and 12.6x, said the brokerage firm 

"We assign “Avoid” rating to this IPO as the company is available at an expensive valuation as compared to its peers. We believe valuations are not in favor of the investors," it added. 

Prudent Corporate Advisory Services is one of the leading independent retail wealth management services groups (excluding banks) in India and is among the top mutual fund distributors in terms of average assets under management and commission received. 

It offers a technology-enabled, comprehensive investment and financial services platform with end-to-end solutions critical for financial products distribution and presence across online and offline channels.