What is your view about investing in the Prudent Corporate Advisory IPO and what should be the parameters to watch out for?

Here I would like to underline that the best answer is to consult with your financial advisor before taking an IPO investment decision. It is not just about whether it is a good IPO but about how good and suitable it is for you. However, here are some factors I would suggest that you seriously consider ahead of the IPO issue.

a) Prudent Corporate Advisory Services is a financial supermarket but adds it up with a smart advisory model. This makes it perfectly appealing to the millennial population.

b) Mutual fund commissions, including trail, account for 85% of total revenues due to a high equity component. SIPs and MFs as a product are catching on in a big way.

c) Its AAUM grow at CAGR of 32.5% over last five years. Prudent has 1.53 million active SIPs on its platform, leaving a trail of loyal commission payments.

d) Thanks to the distributed asset-light model of Prudent, its expense ratio has fallen in last 2 years from 86.4% to 76.3%. That is a big plus to bankroll growth.

There are some interesting facts that emerge. For instance, in terms of commission income for FY21, Prudent Corporate Advisory was at par with ICICI Securities but lower than NJ Finvest. The market cap of Rs.2,609 crore for Prudent does reduce the downside risk for investors to a large extent. I suggest you can look at this IPO from a longer term perspective, since valuations are not too expensive.