• 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.
Review By Dilip Davda on April 22, 2022
Dilip Davda is a veteran financial journalist associated with the Indian stock market since 1978. He has been contributing to print and electronic media on capital markets, insurance, and finance since 1985.
He is widely recognized for reviewing public issues and non-convertible debentures (NCDs) in the primary market. Drawing on over three decades of market experience and close interaction with merchant bankers, his reviews focus on detailed fundamental and financial analysis of companies, with a special emphasis on SME public issues.
Dilip Davda
SEBI Registered Research Analyst – Mumbai
Registration No.: INH000003127 (Perpetual)
Email: dilip_davda@rediffmail.com
Disclaimer: The information provided herein is solely for educational and informational purposes and does not constitute an offer, solicitation, or recommendation to buy or sell any securities. Readers are advised to consult a qualified financial advisor before making any investment decisions. Investments in the securities market are subject to market risks. The author does not intend to invest in the securities discussed.
