Sangam Advisors Ltd IPO Review (Avoid)

Review By Dilip Davda on Jul 20, 2012

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.

Reviewer recommends Avoid to the issue.

Review By Dilip Davda on Jul 20, 2012

Review Author

DISCLAIMER: No financial information whatsoever published anywhere here should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is purely for educational and information purposes only and under no circumstances should be used for making investment decisions. Readers must consult a qualified financial advisor before making any actual investment decisions, based on information published here. With entry barriers, SEBI wants only well-informed investors to participate in such offers. With crazy listings in the past, SME IPOs drew the attention of investors across the board. However, as SME issues have entry barriers and continued low preference from the broking community, any reader taking decisions based on any information published here does so entirely at own risk. The above information is based on information available as on date coupled with market perceptions. The Author has no plans to invest in this offer.

(SEBI registered Research Analyst-Mumbai).


About Dilip Davda

Dilip Davda

Dilip Davda is veteran journalist associated with stock market since 1978. He is contributing to print and electronic media on stock markets/insurance/finance since 1985.

Dilip Davda is a leading reviewer of public issues and NCDs in the primary stock market in India. The knowledge he gained over 3 decades while working in the stock market and a strong relationship with popular lead managers makes his reviews unique. His detail fundamental and financial analysis of companies coming up with IPO helps investors in the primary stock market. Dilip Davda has a special interest in analyzing the SME companies and writing reviews about their public issues. His reviews are regularly published online and in news papers.

Email: dilip_davda@rediffmail.com

Sangam Advisors IPO FAQs

  1. 1. Why Sangam Advisors IPO?

    The initial public offer (IPO) of Sangam Advisors Ltd offers an early investment opportunity in Sangam Advisors Ltd. A stock market investor can buy Sangam Advisors IPO shares by applying in IPO before Sangam Advisors Ltd shares get listed at the stock exchanges. An investor could invest in Sangam Advisors IPO for short term listing gain or a long term.

  2. 2. How is Sangam Advisors IPO?

    Read the Sangam Advisors IPO recommendations by the leading analyst and leading stock brokers.

  3. 3. Sangam Advisors IPO what should investors do?

    Sangam Advisors IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the Sangam Advisors IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts in the above answer.

  4. 4. Is Sangam Advisors IPO good?

    Our recommendation for Sangam Advisors IPO is to avoid.

  5. 5. Is Sangam Advisors IPO worth Investing?

    As per the analysis by our lead analyst Mr. Dilip Davda, we suggest you to avoid the Sangam Advisors IPO.

  6. 6. When will Sangam Advisors IPO allotment status?

    The Sangam Advisors IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit Sangam Advisors IPO allotment status to check.

  7. 7. When will Sangam Advisors IPO list?

    The Sangam Advisors IPO will list on Thursday, August 9, 2012, at BSE SME.

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