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Aurum PropTech RI review (May apply)

Aurum PropTech Limited Logo

•    APL is engaged in digital technology products service providing to the real estate segment.
•    It has posted erratic financial performances so far with losses in 9M FY22.
•    Based on its current trading price, the offer is at about a 30% discount.
•    Shareholders can sell their current holding to apply for RI with additional shares.

ABOUT COMPANY:
Aurum PropTech Ltd. (APL) is engaged in developing and providing digital technology products, services, and platforms with a specific focus on the real estate industry. Its core business is 'PropTech' which brings within its ambit the use of technology and software solutions for disparate needs of the real estate sector and offers advanced data and analytics capabilities for real-time feedback. 

Currently, it operates PropTech business through the following technology platforms (i) Aurum Listing; (ii) Aurum Crex; and (iii) Sell.do (iv) Kylas; and (v) BeyondWalls.  The company caters to various aspects of the real estate sector from the acquisition of a property to the management and monetization of the property thereby catering to the entire real estate value chain across all asset classes by providing technologically innovative products and services on its platforms to make real estate more accessible, connected, data-driven, and transparent, with a view to, enhancing enterprise efficiency and customer experience, and promoting connected living.

Sell.do, Kylas and BeyondWalls are operated by its Material Subsidiary i.e. K2V2, which holds a broad portfolio of PropTech products, real estate brokerage and digital marketing business. 

ISSUE DETAILS:
To part finance its funding needs for product development (Rs. 37.50 cr.), product marketing (Rs. 31.00 cr.), identified investment (Rs. 156.70 cr.) and inorganic growth initiatives/general corporate purposes (Rs. 113.87 cr.), APL is coming out with a Rights Issue (RI) of 42944533 equity shares of Rs. 5 each at a fixed price of Rs. 80 per share to mobilize Rs. 343.56 cr. The company is offering the right shares in the ratio of 3 for 2 to the shareholders registered on the record date of April 14, 2022. The issue opens for subscription on April 26, 2022, and will close on May 10, 2022. Investors will have to pay Rs. 20 per share on application and the balance on one or more calls by the company from time to time. Post allotment, shares will be listed on BSE and NSE. APL is spending Rs. 4.49 cr. for this RI process. 

The issue is solely lead managed by DAM Capital Advisors Ltd. while KFin Technologies Ltd. is the registrar to the issue. 

Post RI, APL's current paid-up equity capital of Rs. 14.31 cr. will stand enhanced to Rs. 35.79 cr. Based on the RI pricing, the company is looking for a market cap of Rs. 572.59 cr. 

FINANCIAL PERFORMANCE: 
On the financial performance front, for the last three fiscals, APL has (on a consolidated basis) posted turnover/net profits of Rs. 33.33 cr. / Rs. 13.99 cr. (FY19), Rs. 18.39 cr. / Rs. 5.28 cr. (FY20) and Rs. 53.25 cr. / Rs. 2368.09 cr. (FY21). FY21 includes a one-time income of Rs. 3067.97 cr. (at gross level). For 9M of FY22 ended on December 31, 2021, it has earned posted loss of Rs. - (6.78) cr. on a turnover of Rs. 11.42 cr. Promoters' shareholding is currently at 35.04% as per the public domain, but data on this aspect is not available on the BSE website. 

DIVIDEND POLICY:
APL paid a dividend of 20.55% for FY19 and FY20 and thereafter it skipped. It will adopt a prudent dividend policy post listing of RIs based on its financial performance and future prospects. 

SCRIP PERFORMANCE: BASED ON BSE WEBSITE DATA: SCRIP CODE: 539289
The scrip last closed on cum-right basis at Rs. 146.10 on April 11, 2022, and opened on an ex-rights basis at Rs. 116.00 on April 12, 2022.  Since then it has posted a high/low of Rs. 128.85 / Rs. 109.55. It last closed at Rs. 112.00 on April 22, 2022. Based on this quote, its post-RI market cap stands at Rs. 800.18 cr. The counter is under ASM LT - Stage 1 at present.  The scrip has posted the last 52 weeks high/low of Rs. 162.75 / Rs. 50.34.


Conclusion / Investment Strategy

The company has posted erratic financial performances. The counter is well operated by vested interests to lure investors to RI subscriptions. Based on its current trading price, prudent shareholders should sell their current holding and apply for RI to expand their holding.

Review By Dilip Davda on Apr 22, 2022

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. Any reader taking decisions based on any information published here does so entirely at its own risk. Investors should bear in mind that any investment in stock markets is subject to unpredictable market-related risks. The above information is based on RHP and other documents available as of date coupled with market perception. The author has no plans to invest in this offer.

(SEBI registered Research Analyst-Mumbai).


About Dilip Davda

Dilip Davda, a freelance journalist

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

More Aurum PropTech Limited RI Views / Analysis / Recommendations ...

The Aurum PropTech Rights Issue 2022 Analysis helps you to understand about the company, offer detail, valuation, capital structure and financial performance. Our SEBI registered Rights Issue Analysts tells you if Aurum PropTech Rights Issue 2022 worth investing. The Aurum PropTech Rights Issue 2022 Note sets the Rights Issue expectations in systematic way which tells you if Aurum PropTech Rights Issue 2022 good to buy (good or bad / yes or no). The Rights Issue Forecast tells you weather to invest in Aurum PropTech Rights Issue 2022 by providing Rights Issue recommendations i.e. subscribe, avoid and neutral.


2 Comments

2. GOPAL MANKAR   I Like It. | Report Abuse |   Link | Apr 27, 2022 5:36:54 PM Reply
How to apply online for right issue. Please send online proforma as it send by TCS for buy back scheme
2.1. Giriraj   I Like It. | Report Abuse |   Link | Apr 28, 2022 8:21:34 PM
Don't know why it has to be so complicated....simply a r-wap link can be sent on email and payment made. KFintech is quiet about payment. Strange....
2.2. Harish Vardan K   I Like It. | Report Abuse |   Link | May 2, 2022 10:40:17 PM
you can apply it from your sbi internet banking login IPO/Rights option
1. Girish   I Like It. | Report Abuse |   Link | Apr 29, 2022 9:17:53 AM Reply
no link is given on the kfintech site for apply.