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Anand Rathi Wealth Ltd, part of Mumbai-based financial services group Anand Rathi, has launched its initial public offering (IPO) today for public subscription and the three day share sale will conclude on December 6. The price band has been fixed at 530-550 per share. The company on Wednesday said it has raised 194 crore from anchor investors ahead of its IPO.

As of 11:10 am on day 2, Anand Rathi Wealth IPO has been subscribed 1.94 times with retail category overbooked 3.05 times, non-institutional investors bid 2.14 times and QIBs 0.01x, BSE data showed.

The initial share sale is entirely an offer for sale (OFS) of 1.2 crore equity shares by promoters and existing shareholders. At the upper end of the price band, the initial share sale is expected to fetch 660 crore.

As per market observers, Anand Rathi Wealth shares are available at a premium (GMP) of 110 in the grey market today. The equity shares of the company are expected to listed on BSE and NSE on December 14.

"Given the fundamentals and growth potential, valuation of (ARWL) looks reasonable, as at upper end of price band, the company is valued at ~7.5% AUM and ~18.7x EPS (annualised FY22E). The closest listed peer IIFL Wealth has over 2.2 lakh crore in AUM and trading at 25xFY22E (consensus) offers healthy growth potential too. We remain positive in the space and assign SUBSCRIBE rating to the IPO," said ICICI Securities in a note.

Anand Rathi Wealth operates in the financial services industry with a focus on mutual fund distribution and the sale of financial products. The company commenced activities in fiscal 2002 and is AMFI registered mutual fund distributor.

“The price-to-earnings valuation at which the firm is raising money is 18.67, while the competitor IIFL Wealth demands a P/E of 24.59 from the market, so relatively, this issue is not that expensive. With the growing capital market in India, Financial Intermediaries have an excellent scope of growth which should make this IPO attractive from a growth perspective. I would recommend buying on this issue with caution about the broader market that can play spoilsport for IPOs," said Sonam Srivastava, Founder, Wright Research.

 

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