Sodhani Capital IPO Lists on BSE SME: Oversubscribed but No Grey Market Premium
Sodhani Capital, a Jaipur-based mutual fund distribution firm, is launching its IPO on the BSE SME platform on October 7. The IPO, priced at Rs 51 per share, raised Rs 10.71 crore and was oversubscribed 4.79 times. The company plans to use the funds for office expansion in Mumbai, brand-building, and technology development. Despite strong subscription rates, the grey market premium remains flat, suggesting a listing near the issue price. Sodhani Capital reported a total income of Rs 4.13 crore and a net profit of Rs 2.18 crore in FY2023, with high PAT and EBITDA margins.
*this image is generated using AI for illustrative purposes only.
Sodhani Capital, a Jaipur-based mutual fund distribution and financial services firm, is set to make its debut on the BSE SME platform on October 7. The initial public offering (IPO) was priced at Rs 51 per share and raised Rs 10.71 crore. Despite being oversubscribed, the grey market premium remains flat, suggesting a listing around the issue price.
IPO Performance
The IPO garnered significant interest from investors, achieving an overall subscription of 4.79 times. Here's a breakdown of the subscription details:
| Investor Category | Subscription Rate |
|---|---|
| Non-Institutional Investors | 5.99 times |
| Retail Investors | 4.85 times |
IPO Structure and Fundraising
The IPO comprised two components:
| Component | Amount (in Rs crore) |
|---|---|
| Fresh Issue | 8.62 |
| Offer for Sale | 2.09 |
| Total | 10.71 |
Fund Utilization
Sodhani Capital plans to use the proceeds for:
- Acquiring office premises in Mumbai
- Brand-building initiatives
- Technology development
Company Overview
Sodhani Capital specializes in mutual fund distribution and financial services, primarily serving retail and high-net-worth individuals in Tier-II and Tier-III cities. The company generates revenue through commissions from mutual fund sales.
Financial Highlights
| Metric | Value |
|---|---|
| Total Income (FY2023) | 4.13 |
| Net Profit (FY2023) | 2.18 |
| PAT Margin | 53% |
| EBITDA Margin | 74% |
It's worth noting that while the total income saw a 10% increase, there was a slight decline in net profit from Rs 2.21 crore in the previous year to Rs 2.18 crore in FY2023.
Market Expectations
Despite the oversubscription, the grey market premium for Sodhani Capital stands at Rs 0, indicating that the stock may list close to its issue price of Rs 51.
The listing of Sodhani Capital on the BSE SME platform represents an opportunity for investors interested in the financial services sector, particularly in the mutual fund distribution space. However, as with all investments, it's crucial for potential investors to conduct thorough research and consider their risk appetite before making investment decisions.
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