Skip to main content

SKS Microfinance IPO Review

SKS Microfinance has come out with an IPO of of 1.68 cr equity shares of Rs.10 each, in the price band of Rs. 850 to Rs. 985 per share. The company is basically an NBFC, with a network of 2,029 branches in 19 states, catering to 67.8 lakh women borrowers and is the largest micro finance institution in India.

Details of the issue:
Issue Open: Jul 28, 2010 - Aug 02, 2010.
Issue Size: 16,791,579 Equity Shares of Rs. 10 each.
Issue Price: Rs. 850 - Rs. 985 Per Equity Share.
Market Lot: 7 Shares.
Listing At: BSE and NSE.

Fundamental Updates:
The company has reported an EPS of Rs.27 and has a book value of about Rs.145. At the current offer price the stock would be trading at 30 P/E and 6 times the Book value. Though the topline as well as bottomline of the company has witnessed the CAGR of more than 100% from FY08 to FY10, the offer price is expensive.

There is a lot of hype being created for this issue, mainly due to Infosys - Narayana Murthy and George Soros - Quantum fund being PE investors in the company. But they have been alloted these shares around Rs.300 and the IPO is price is much higher at 850-985.

But still the issue is likely to get good response from the institutional investors and may be well subscribed. Hence investors looking for listing gains (which is always risky)  may apply, since it has got market fancy. But but other than that, the issue is definitely expensive.


Post a Comment

Popular posts from this blog

Your Bill Amounts Are Going To Increase From June 1, 2016

Service tax is a tax levied by the government on service providers on certain service transactions, but is actually borne by the customers. It is categorized under Indirect Tax and came into existence under the Finance Act, 1994. Union Finance Minister, Arun Jaitley, in his budget announcements proposed to impose a cess, called the Krishi Kalyan Cess, @ 0.5% on all taxable services. The present rate of service tax will be hiked to 15 per cent from June 1, 2016, from 14.5 per cent. Take a look at what gets expensive:

Phone Bills: Your phone bills are going to go up. So, pay a good 15 per cent now on service tax on phone bills.

Restaurant Bills :If you are dining in a restaurant that already has service tax applicable, you are going to pay more on your eating out. Though 0.5 per cent on a single bill may not mean much, frequent diners may end-up paying a lot during the year.

Travelling: You will have to pay more for air travel, as there is a service tax on tour operators and travel agents.

What is Gold ETF - Gold Bees, Reliance Gold,Kotak Gold

What is Gold Bees or Gold ETF?

Gold ETFs are open-ended mutual fund schemes that will invest the money collected from investors in standard gold bullion (0.995 purity). The investors' holding will be denoted in units, which will be listed on a stock exchange.They provide returns that would closely track the returns from physical gold in the spot market.

An investor can buy and redeem the units either directly from the mutual fund or from the stock exchange.Presently there are many Gold ETFs traded in NSE India. Some of the listed Gold ETFs are GoldBees,Reliance Gold,Kotak Gold,UTI Goldshare

Why choose Gold?
Gold holds its own in any investment evaluation on its strengths as a hedge against inflation, value in the event of political uncertainties and its traditionally negative co-relation with other asset classes such as stocks, fixed income securities and commodities.

The value of goods and services that gold can buy has remained stable unlike currencies that have seen significant…


NIFTY BEES - is the first ETF (Exchange Traded Fund) in India, which seeks to provide investment returns that closely correspond to the total returns of securities as represented by the S&P CNX Nifty Index. It gives you the most diversified exposure at lowest possible unit size. Approximately value of Nifty bees will be 1/10th value of the prevailing Nifty price.

ETFs are one of the latest financial innovations and any new concept takes time to be known widely. Globally it took more then five to seven years before it could be of any significant size. In India, it was introduced with Rs 21 crore in size , a fraction of the mutual fund industry, it has come far with more than Rs 700 crore in size with six ETFs.

The Nifty BeES also scores over other index funds due to its low tracking error and expense ratio, apart from easier tradeability as it is listed in the NSE. One can also consider doing an SIP in Nifty BeES.

Some of the reasons to invest in Nifty Bees : Investing in Exchange …