The DAM Capital Advisors Limited IPO has shown significant attention in the market. Opening on December 19th and closing on December 23rd, it has achieved an oversubscription of 7 times in the initial days. Let’s explore the IPO’s details, GMP, financials, and investment potential.
About DAM Capital Advisors Limited
The company started its journey in the securities market in 1993 as S.S. Kantilal Ishwarlal Sharebrokers and Investors Private Limited. In 1994, the company rebranded as S.S. Kantilal Ishwarlal Securities Private Limited (SSKIPL).
In 2006, Infrastructure Development Finance Company (IDFC) started acquiring SSKIPL, completing the process in 2008. In 2019, the IDFC group sold its entire stake to Dharmesh Anil Mehta and other investors. Following this, in July 2020, the company rebranded as DAM Capital Advisors Limited.
DAM Capital Advisors Limited IPO: Grey Market Premium and Potential Gains
The grey market premium (GMP) for DAM Capital Advisors Limited IPO is currently at ₹180, indicating an estimated 63% listing gain. For example, a lot of 53 shares priced at the upper band of ₹283 per share could yield profits of approximately ₹15,000 upon listing. However, GMP reflects speculative sentiment, not guaranteed results.
DAM Capital Advisors Limited IPO: Business Model and Industry Overview
DAM Capital Advisors Limited is a top-tier Indian investment bank specializing in:
- Investment Banking:
- Capital raising through equity markets.
- Mergers and acquisitions advisory.
- Complex financial consulting.
- Institutional Equities:
- Stock broking and market research services.
- Catering to institutional investors worldwide.
With over 260 active clients from the USA, UK, and Europe and a market share of 12.1%, the company’s global presence enhances its competitive edge.
DAM Capital Advisors Limited IPO Details: Timeline and Key Figures
Here’s a summary of the IPO’s critical details:
- Price Band: ₹269 to ₹283 per share.
- Issue Size: ₹840 crores (100% Offer for Sale).
- Lot Size: 53 shares.
- Minimum Investment: ₹14,999.
- Important Dates:
- Subscription Period: December 19-23.
- Allotment Finalization: December 24.
- Refund Initiation: December 26.
- Listing Date: December 27.
The Offer for Sale (OFS) means proceeds won’t fund the company’s growth. Post-IPO, promoter holding will reduce from 46% to 41%.
DAM Capital Advisors Limited IPO: Financial Performance and Trends
Understanding the company’s financial performance is crucial.
- Revenue:
- FY22: ₹94 crores.
- FY23: ₹85 crores.
- FY24: ₹182 crores (significant recovery).
- Profit After Tax (PAT):
- FY22: ₹21 crores.
- FY23: ₹8 crores.
- FY24: ₹70 crores (impressive growth).
- Net Worth and Debt:
- Minimal debt (₹5 crores in FY24).
While FY24 shows strong profitability, previous inconsistencies raise concerns.
DAM Capital Advisors Limited IPO: Fundamental Metrics and Valuation
The IPO’s valuation metrics include:
- Return on Equity (ROE): 15% (commendable).
- Profit Margin: 40% (efficient operations).
- Price-to-Earnings (P/E) Ratio: 28 (above industry average).
- Price-to-Book (P/B) Ratio: 12.76 (also high).
Valuations seem stretched compared to peers, suggesting limited long-term upside.
DAM Capital Advisors Limited IPO: Strengths and Weaknesses for Investors
Strengths:
- Market leader in investment banking with 12.1% market share.
- Strong client base spanning global markets.
- Financially stable with negligible debt.
- High profit margin of 40% in FY24.
Weaknesses:
- Inconsistent financial performance over the years.
- Valuation metrics are higher than competitors.
- Proceeds from the IPO won’t support business growth.
- Cyclical nature tied to capital markets.
DAM Capital Advisors Limited IPO: Is It Worth Investing?
- Short-Term Gains:
- With a GMP of ₹180 and potential listing gains of 30-50%, the IPO is attractive for short-term investors.
- Oversubscription trends and retail demand further enhance prospects.
- Long-Term Investment:
- Strong fundamentals but inconsistent performance and high valuations pose risks.
- Cyclical business model makes it less appealing for risk-averse investors.
Summary: Should You Apply for DAM Capital Advisors Limited IPO?
The DAM Capital Advisors Limited IPO offers promising short-term gains, its high GMP, and robust demand. However, long-term investors should tread cautiously due to valuation concerns and financial inconsistencies. Conduct thorough research and align investments with your financial objectives. Are you applying for this IPO or staying away? Share your thoughts!
DAM Capital Advisors IPO Update as of 23/12/2024.
DAM Capital Advisors IPO Update: As of December 23, the grey market premium (GMP) for the public offering of DAM Capital Advisors is ₹160 per share. Given the upper price band of ₹283, the shares are anticipated to debut on the stock market at ₹443 each, reflecting a premium of 56.54%.
The grey market premium (GMP) indicates the amount investors are prepared to pay above the issue price for a public offering. The company’s shares are projected to be listed on Friday, December 27.
Investors registered for 1,70,35,38,349 shares, in contrast to the 2,08,04,632 shares available for subscription. The allocation for qualified institutional buyers (QIBs) was oversubscribed by 166.33 times, while the non-institutional investors (NIIs) segment saw a subscription rate of 98.47 times. On the final day, the portion designated for retail investors was subscribed to 26.80 times.
Disclaimer: This article is for informational purposes only. Always consult a financial advisor before making investment decisions.
