InvestorQ : Can you tell me the major highlights of the proposed Aditya Birla Sun Life AMC IPO which is opening shortly?
indhumathi Sayani made post

Can you tell me the major highlights of the proposed Aditya Birla Sun Life AMC IPO which is opening shortly?

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3 months ago
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Here are some of the major highlights of the Birla Sun Life AMC IPO.

· The IPO will open for subscription on September 29 and close on October 1. The price band has fixed in the range of Rs 695-712 per share.

· At the upper end of the band at Rs.712, the size of the IPO would be Rs.2,768 crore, while the overall valuation of the AMC would be around Rs.20,500 crore.

· The issue is totally an offer for sale by the promoters, Aditya Birla Capital and Sun Life UK. The stake of Aditya Birla Capital will reduce from 51% to 50.01% while the stake of Sun Life will reduce from 49% to 36.49%. The balance 13.50% will be held by public.

· It must be noted that in terms of overall AUM, Birla AMC has total AUM of Rs.284,000 crore. It ranks fourth overall in terms of AUM among Indian AMCs and is the largest AMC in terms of AUM having a non-bank sponsor.

· While the company has seen revenues trend lower in the last two years due to pressure on expense ratio at the insistence of SEBI, the profits and the net margins have moved up sharply due to cost controls and due to lower impairment.

· The post issue market cap values the company at around 7.6% of the AUM. In P/E terms the stock is around 39 times earnings, although share of AUM is a better metrics for an asset management company.

· This will be the fourth AMC in India to be listed after Nippon India AMC, HDFC AMC and UTI AMC. The AMC business is a play on the financialization of savings in the Indian economy over the last few years.

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