Next IPO

None at the moment!

Market is too volatile to predict for IPO currently. Though Reliance power looks okay.

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Next IPO

None at the moment!

Wait for next round of upcoming IPOs, after market stabilizes.




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Next IPO

None at the moment!

Wait for next round of upcoming IPOs.

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Next IPO

Dhanus Technologies

Offer price: 280 -295
Target Lsting Price: 420

Dhanus Technologies, a rapidly growing communication services company, proposes to enter the capital markets on September 10, 2007 with a public issue of 38,35,000 equity shares of Rs 10 each through 100% book building process.

The issue closes on September 12, 2007 and the price band has been fixed at Rs 280 to Rs 295 per equity share of Rs 10 each. The company is going to raise Rs 113.13 crore in the higher end of band and Rs 107.38 at lower band.

After allowing for reservation of 2,00,000 equity shares for employees, the net issue to the public will be 36,35,000 equity shares. The issue would constitute 21.37% and the net issue would constitute 20.26% of the fully diluted post issue paid up capital of the company.

SREI Capital Markets Limited is the BRLM for the issue and Cameo Corporate Services Ltd is the registrar to the issue.

The company proposes to utilize the net proceeds of the issue for financing its business plans and to achieve the benefits of listing. The company intends to expand its infrastructural facilities and equipment base and would be constructing its new corporate office and network operating centre. The existing infrastructure, equipments, operations and facilities would however continue to be operational at the existing locations at Mena Kampala Arcade, Chennai. The equity shares are proposed to be listed on BSE and NSE.

Dhanus Technologies offers telecommunication services and unified messaging and enhanced logistics services. The company has a BPO operation of telemarketing services to the US, UK and Australia markets.

For the year ended June 30, 2007, the company's total income was Rs 90.46 crore and net profit at Rs 24.59 crore as against total income of Rs 35.93 crore and net profit of Rs 13.09 crores for the year ended June 30, 2006

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Next IPO

None at the Moment!!
[Wait and watch for next market move for some time]

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Next IPO

None at the Moment!!
[Wait and watch for next market move for some time]

Learn the basics: http://knowmarket.blogspot.com/

Next IPO

Motilal Oswal (MOFSL)

Motilal Oswal (MOFSL) a financial services company focused on wealth creation for all its customers such as institutional and corporate clients, HNI and retail customers, proposes to enter capital markets on August 20, 2007 with an initial public offering (IPO) of 29, 82,710 equity shares of Rs 5 each for cash at a price band between Rs 725 and Rs 825 per share with 100% book building process. The issue will close for subscription on August 23, 2007.

Company Profile

Motilal Oswal is a prominent name in the stock broking community and lately this sector had caught the investor’s fancy due to rich valuations being given by the overseas investors, to financial companies in India.

Since, present income of the company is mainly from broking, which is becoming competitive, the valuation seems a bit stretched. The company has recently ventured into investment banking and venture capital. Post issue, the company would be expanding its margin funding to over Rs 200 crore, which is presently at about Rs 88 crore to about 585 clients.

The company has estimated requirement of Rs 195 crore of which, Rs 110 crore is for margin funding. Balance is for working capital and for office premises. All this is to be entirely financed from the proposed issue.

However, considering the strong brand equity, consistent track record, low equity base and recent diversification in venture capital and investment banking, investment can be contemplated. Knowledge, commitment and accountability of the promoters, would keep prospective investors’ interest in mind.

Objective of the Issue

Motilal Oswal Financial Services Ltd proposes to infuse funds into MOSL and in MOCB in the form of a subscription for their equity shares, unsecured loans or any combination thereof. Such capital infusion will help strengthen their respective balance sheets and thus enable them to increase trading volumes in the equities and commodities market. MOFSL provides a financing facility to its retail broking customers. MOFSL proposes to enhance this financing facility.

Other Important things

MOFSL is the holding company of Motilal Oswal Securities Limited (MOSL-broking business), Motilal Oswal Commodities Brokers Pvt. Ltd (MOCB-commodity business), Motilal Oswal Investment Advisors Pvt. Ltd (MOIA-investment banking business) and Motilal Oswal Venture Capital Advisors Pvt. Ltd (MOVC-venture capital advisory).

The company is going to raise Rs 216.25 crore in lower end of the price band and Rs 246 crore at higher band.

The issue comprises a net issue to the public of 2,840,400 equity shares of Rs 5 each and a reservation of 142,310 equity shares of Rs 5 each for subscription by eligible employees at the issue price. The issue will constitute 10.50% and the net issue will constitute 10.00% of the post issue paid-up equity capital of the company.

The equity shares are proposed to be listed on the BSE and NSE. Citigroup Global Markets India Pvt Ltd is the book running lead manager and Intime Spectrum Registry is the registrar to the issue.

Valuation

TSL offered the shares at P/E multiple of 19.26x to 20.84x at floor and cap price respectively, as against its peers Sasken Communication Technologies and Subex Azure, which are trading at P/E multiple of about 39x and 101.7x respectively. On the other hand, shares of TSL are available in the range of 7.63 to 8.25 times of net asset value at floor and cap price respectively. Among the other factors, TSL`s niche position in supply chain management and life sciences segment combined with large product bank with low ownership costs are expected to strengthen the position of TSL in future.

Considering the above factors, the issue of TSL seems to be underpriced with a potential to provide short term gains, subject to favorable market conditions.

Motilal Oswal is mainly into broking, investment banking. It has presence in 377 cities with 1200 branches and 1120 franchises. They have huge clients in retail (major in internet banking) and institutional segments.

The company has market share of 5%, in derivative segment around 3.75%. Revenues from broking business are nearly 86%, EBITDA margin stood at 32%. It is debt free company.

Motilal Oswal has 30 mandates in investment banking business and going to invest Rs 550 crore in PMS.

People can apply for the issue, which looks to be good.

My Expectation

In usual scenario this IPO must be hitting 1077 on the listing day.

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Next IPO

None at the moment!!

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Next IPO

TAKE Solutions Limited

TAKE Solutions (TSL) the Chennai-based company came out with an initial public offer (IPO) to mop-up upto Rs 1,533 million to fund the company`s expansion plans. TSL planned to float 2.1 million shares at a price band in the range of Rs 675- 730. The issue is open for subscription till August 7.

The issue will constitute 17.50% of the fully diluted post issue paid up equity capital of the company. The book running lead manager to the issue is Edelweiss Capital.
Shares of the company will list on both BSE and NSE.

Company Profile

Incorporated in 2000, TAKE Solutions is an international business technology company with domain expertise to provide supply chain management and life science solutions. TSL product portfolio includes 16 active products in the supply chain management and 6 products in the life science. TSL has completed more than 2,500 software installations for over 250 customers ranging in size from multinational enterprises to medium- and smaller-sized companies. TSL operates its global operations with help of 8 subsidiaries around the world.

Objective of the Issue

TSL plans to utilise the issue proceeds for acquisition of companies engaged in same business in India and/or abroad to enhance the geographic reach. In addition, TSL will invest funds into product development & expansion of domestic infrastructure facilities, refund debt facilities utilized for acquisitions of US based ClearOrbit and prepayment of term loan.

Financials

TSL presented outstanding financial performance during fiscal 2007. TSL on consolidated basis, registered a robust earnings growth of 3.28 times in fiscal 2007 to Rs 316.37 million over fiscal 2006, supported by strong revenue growth. During the fiscal 2007, TSL reported a revenue growth of 3.79 times to Rs 1,828.29 million over fiscal 2006. On the contrary, the operating margin of TSL slipped to 25.26% in fiscal 2007, a decline of 737 basis points over fiscal 2006.

Valuation

TSL offered the shares at P/E multiple of 19.26x to 20.84x at floor and cap price respectively, as against its peers Sasken Communication Technologies and Subex Azure, which are trading at P/E multiple of about 39x and 101.7x respectively. On the other hand, shares of TSL are available in the range of 7.63 to 8.25 times of net asset value at floor and cap price respectively. Among the other factors, TSL`s niche position in supply chain management and life sciences segment combined with large product bank with low ownership costs are expected to strengthen the position of TSL in future.
Considering the above factors, the issue of TSL seems to be underpriced with a potential to provide short term gains, subject to favourable market conditions.

My Expectation

In usual scenario this IPO must be hitting 1000 on the listing day. And it may go upto 1150 in a month.

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One should know few things about Roman Tarmat IPO

We maintain a No signal for Roman Tarmat IPO. Reasons are

• The company has been taking the benefit of Section 80IA for the past two years. The effective tax rate for FY06 is 5.4% and that for 9m FY07 is 3.5%. With the benefit been taken away from the contractor companies like Roman Tarmat, the company's profitability will be adversely affected.
• Over 62% of the company's order book is constituted by two major orders. Thus, the visibility of revenue flows is limited going forward.
• Till date, the company has not bagged any orders from NHAI. The company mostly has small size orders (orders below Rs 1 billion) in its books. Thus, scalability of company's business remains a concern.
• A large proportion of company's revenue and order book is derived from low margins roads and highway segment.
• Keeping these in mind we firmly believe that the IPO is aggresively priced.

We advise to not go for this IPO, and probably after listing even after correction, don't opt for it. You'll find so many good stocks in secondary market to pick in.

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Vishal Retail: Lucky ones will have little to cherish says Anand

In IPO, too good a news is a bad news! HNI Mr. Abhishek Anand is of the view that For HNIs pumping money into Vishal Retail happened to be as bad as pumping it into an IPO which couldn't get subscribed even 50%.

Anand puts an example for this; consider for an HNI who has put INR 2 million into Vishal retail IPO, taking oversubscription ratio of 300, at the end of allotment process, he may get meager 25 share in hand. Even at 100% premium listing it'll earn him a maximum of INR 6750. Now consider the interest rate (15% industry avg), he'll turn up paying on that over a month period, which if you calculate will come down to 25000. So at the end of day he is in loss, isn't he?

Well, even those in retail sector who will be among the lucky ones to get 25 shares, will have very little to cherish Anand goes on to say.

Probably Vishal Retail would have been a real good investment if DLF, which also opened for subscription on the same day, would have kept less aggressive pricing.

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ICICI FPO...just don't jump blindly!

We believe that correction is due in ICICI since long. In current brouhaha of FPO, it has got delayed a bit longer. And hence now shortly after getting listed it would be fair to say that a correction is anticipated. For the retailers and small investor, we suggest buy it post the announcement of the pricing for the issue. As we believe that once the issue comes if you look at the internals of ICICI it will be more prudent to buy after the issue because we believe there could be some short-term correction in the price of ICICI Bank, and it could be a steep one as well.

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FPO season... now its turn of BEML !

Bharat Earth Movers, BEML is eyeing over Rs 430 crore from the follow-on public issue which opens on June 27. The state-owned company will offer 49 lakh equity shares of Rs 10 each through a 100% book built offering, the price band for which is expected to be announced at the start of next week. The issue closes on July 3.

Of the total issue less 10% reserved for employees, 35% has been reserved for retail investors and 15% allocated for non-institutional. Qualified institutional buyers have a lion's share in the issue at 50%, of which 5% is for mutual funds. The issue constitutes 11.77% of the fully diluted post issue paid-up capital.

ICICI Securities is the book running lead manager to the issue.

The company plans to fund its expansion and capital expenditure from the issue. Of the proceeds, Rs 214.51 crore will go towards expansion of the Metro coach manufacturing facility at Bangalore, and Rs 90 crore on capital expenditure, including upgradation of current facilities.

The voluntary retirement scheme for employees would use up another Rs 90 crore of the proceeds. The company also plans 5MW windmill for captive consumption at a cost of Rs 27 crore and a R&D centre for Metro coaches at an investment of Rs 9 crore.

Any shortfall in funds for the said objectives would be met through internal accruals.

The government currently holds 61.23% in Bharat Earth. Mutual funds hold 13.89%, financial institutions/banks hold 7.26%, foreign institutional investors hold 7.8%, resident individuals hold 6.11% and corporate bodies hold 2.6%.

Post issue, the government's holding in the company will fall to 54.03%.

Bharat Earth is the second largest manufacturer of earthmoving equipments in Asia, and commands 70% market share in domestic industry. The company has a diversified portfolio of products catering to defence equipment, railways, mining, steel, cement, power, irrigation, construction and road building.

The ministry of defence is Bharat Earth's largest customer. The company's other customers are Indian Railways, Delhi Metro Rail Corporation and other metro rail transit agencies.

As on Feb 28, 2007, Bharat Earth's order book stood at Rs 1,200.74 crore. Of this, Rs 236 crore was from the defence business. The company also had orders from the New Delhi Railway Board worth Rs 102.96 crore.

What's interesting is the company will detail its results for the year ended Mar 31, 2007 on June 25, just two days before the issue opens, reports The Economic Times.

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