While the primary market is at stand sill as secondary market is witnessing lackluster performance amidst ongoing uncertainties and paralyzed economic reforms process. Although PM has taken over reins at Finance Ministry, his action has just remained on paper and no actual things have shaped in a concrete manner and thus market is waiting for the real move in action. It is hoped that post President's election results, things will take shape for betterment as this Government has just around 18 months to regain its lost glory. All eyes are now on Dr. Manmohan's action and waits for some magic like 1991 rally. Just wait and watch.
Amidst such scenario, we are seeing more and more BSE-SME IPOs queuing up for funds mobilization. According to primary market sources there are about three SME IPOs set to enter the primary market before this month end. One such IPO of Sangam Advisors is opening on 24.07.12 for a paltry amount of Rs. 5.07 crore mobilizations.
Sangam Advisors Ltd. (SAL) is promoted by Giza Estates Pvt Ltd and is engaged in the business of providing diversified financial services with a primary focus in assisting small and medium enterprises (SMEs) in corporate and non-corporate sector in their financial planning, corporate restructuring and fund syndication requirements. It is also in the business of investing in shares and other securities by leveraging its disciplined investment approach developed by its in-house experienced senior management team.
The total Public issue of 23,04,000 equity shares of Rs. 10/- each of SAL for cash at price of Rs. 22/- per share aggregating to Rs. 5.07 crores. Of which, 3,42,000 equity shares of Rs. 10/- each will be reserved for subscription by Market Makers to the issue. The balance issue of 19,62,000 equity shares of Rs. 10 each being the "Net Issue". The issue and the net issue will constitute 37.75% and 32.15%, respectively of the post issue paid up equity share capital of the company. The average EPS of the company for last three fiscal is just Rs. 0.36 on old equity and NAV is at Rs. 11.56 as on 31.03.12 . This makes it highly priced issue.
The issue is opening on 24.07.12 and will close on 26.07.12. Minimum application is to be made for 6000 shares and in multiples thereof. The funds so mobilized will be used for investments in listed/unlisted securities and general corpus needs. Issue is lead managed by Aryaman Financial Services Ltd. and Purva Sharegistry (India) Pvt. Ltd is registrar to the issue. Lead Manager has poor track record for IPO mandates.
Conclusion / Investment Strategy
Only HNIs' with surplus funds can opt for this IPO for listing gains, if any, as current market scenario is not in favor for this offer at the asking price.
IPO Review Author
About Dilip Davda
Dilip Davda, a freelance journalist for more than 25 years, is a stock market analyst and news article writer. Since 1985, he has contributed to print media, electronic media and often appears on TV channels as visiting stock analyst. His articles are regularly publishes in Corporate India, Smart Investment (English and Gujarati weekly published from Ahmedabad), Free Press Journal and many other news papers & magazines. He is also a visiting stock analyst on DD News TV Channel.