5Paisa Capital March 26 RI review - (Not Rated)

•    This is the 2nd rights issue from the company since May 2019.
•    The company is engaged in financial services segment with major focus of discount broking activities that offers investment and trading solutions.
•    The company posted growth in its bottom lines for FY24 and FY25 despite declined top lines.
•    For 9M-FY26, it marked degrowth on its top and bottom lines, that raise a concern.
•    The RI is priced greedily and currently trading below the RI price.
•    There is no harm in skipping this “High Risk/No Return” greedily priced offer.

ABOUT COMPANY:
5 Paisa Capital Ltd., (FPCL) is a technology-driven financial services company focused on discount broking, offering a comprehensive suite of investment and trading solutions through a robust online platform and mobile application. The company is registered with SEBI as a stockbroker and depository participant. Additionally, it is acknowledged by AMFI as a mutual fund distributor. Its services span the capital markets, futures and options, currency derivatives segments, commodity derivatives and it distributes mutual funds and IPOs with memberships across leading Indian stock exchanges. The company is also a depository participant, enabling seamless and integrated access to trading and demat services.

As a discount broker, it follows a flat brokerage structure model by charging a uniform fee per order across transactions. This pricing approach and technology infrastructure helps reduce friction and improve cost efficiency for investors. Its platform is built with focus on innovation and user experience. The key features of its platform include completely paperless account opening, real-time market data and insights, advanced charting and analytics tools, seamless fund transfers and margin/MTF access, and an intuitive, mobile-first interface enabling fast, secure, and frictionless order execution across asset classes.

FPCL operates in the financial services industry in India where it conducts its business and generate majority of its revenues. The company, and in particular, its stock broking, depository participant and mutual funds distribution businesses are, highly dependent on the securities market, which is significantly affected by global macroeconomic factors, and in particular, macroeconomic factors affecting India. The Indian equity markets are affected by a variety of factors including growth in India’s GDP, taxation, monetary and other policies of the Government of India, laws and regulations that affect trading, political measures and regulatory developments, and general political stability, inflation, interest rate levels, change in consumer spending and saving patterns such as a shift from one category of investment to another, currency exchange rates and foreign investment including perceived unattractiveness of the Indian markets. The offer document is silent on its employees’ strength data.

ISSUE DETAILS:
The company is coming out with its 2nd Rights Issue (RI) of 15627419 equity shares of Rs. 10 each at a fixed price of Rs. 300.00 per share to mobilize Rs. 468.82 cr. The RI opens for subscription on March 27, 2026, and will close on April 10, 2026. The company is offering RI in the ratio of 1 for 2 to its eligible stakeholders as of the record date of March 17, 2026. The company is asking for full money on application for number of shares applied. Post allotment, RI shares will be listed on BSE and NSE. The company is spending Rs. 3.74 cr. for this RI process, and from the net proceeds, it will utilize Rs. 227.00 cr. for augmenting funds for maintenance of margin deposits with stock exchanges, Rs. 150.00 cr.  repayment of certain borrowings, and Rs. 88.08 cr. for general corporate purposes. 

The RI is solely lead managed by the company itself, and MUFG Intime India Pvt. Ltd. is the registrar to the issue. 

Post-RI, company’s current paid-up equity capital of Rs. 31.25 cr. will stand enhanced to Rs. 46.88 cr. Based on the RI pricing, the company is looking for a market cap of Rs. 1406.47 cr. 

FINANCIAL PERFORMANCE:
On the financial performance front, for the last two fiscals, the company has (on a consolidated basis) posted total income / net profit, of Rs. 394.74 cr. / Rs. 54.44 cr. (FY24), Rs. 359.85 cr. / Rs. 68.238 cr. (FY25). For 9M of FY26 ended on December 31, 2025, it posted a net profit of Rs. 33.33 cr. on a total income of Rs. 234.41 cr. Its NAV stood at Rs. 193.25 as of March 31, 2025. 

DIVIDEND POLICY:
The company has not paid any dividends for the reported periods of the offer document. It will adopt a prudent dividend policy, based on its financial performance and future prospects. The offer document is silent on its dividend policy.

SCRIP PERFORMANCE: BASED ON BSE WEBSITE DATA: SCRIP CODE: 540776 (FV Rs. 10).
The scrip last closed on cum-right basis at Rs. 291.60 on March 16, 2026, and opened on an ex-right basis at Rs. 299.40 on March 17, 2026. Since then, it has marked a high/low of Rs. 302.34 / Rs. 278.15. The scrip last closed at Rs. 279.00 as of March 23, 2026. For the last 52 weeks’ it has posted a high/low of Rs. 431.80 / Rs. 287.95. 

The promoters’ holding has been constant at 32.75% for the last two quarters ended with September 30, 2025. The counter is currently quoting below the offer price and raise alarm.