Edelweiss Capital IPO

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The issue will open on November 15, 2007, and will close on November 20, 2007.
The price band has been fixed between Rs 725 and Rs 825. This issue has been graded by CRISIL and has been assigned the CRISIL IPO Grade 4/5, indicating that the fundamentals of the Issue are above average

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Subscribe to Edelweiss Capital IPO: Anagram

Anagram Stock Broking recommends subscribing to the initial public offering of Edelweiss Capital Ltd. At Rs 725-825 per share, the stock trades at 5.6 times and 6.3 times its FY08E consolidated annualised earnings of Rs 129 per share on its lower and upper price band, the brokerage says.

“We believe it’s at a discount to its peers and thus recommend subscribe to the issue,” Anagram says in its pre-IPO note.

CRISIL has assigned an IPO grade of 4/5 to the company, indicating that fundamentals of the issue are above average.

A leading investment banker and institutional brokerage, Edelweiss Capital is coming out with an issue of 83,86,147 equity shares of Rs 5 each through the book building process. The offer opens on Nov 15 and closes on Nov 20.

The IPO comprises net issue to the public of 81,81,607 shares and reservation of 2,04,540 shares for employees. Out of the net issue, 49,08,965 shares are reserved for qualified institutional buyers, 2,45,448 shares for mutual funds, 8,18,160 shares are marked for non-institutional investors and 24,54,482 shares for individual investors.

The main objects of the issue are enhancement of margin maintenance with stock exchanges and repayment of debt.

Government of Singapore, Galleon Partners and Lehman Brothers together hold 19 per cent in Edelweiss Capital. Lehman also holds 26 per cent stake in ECL Finance, a subsidiary of Edelweiss Capital, acquired at around Rs 180 crore.

Edelweiss’ consolidated revenue and profit increased at CAGR of 119 per cent and 120 per cent respectively between financial years 2005 and 2007. Revenue increased to Rs 371.25 crore in 2006-07 from Rs 77.05 crore in 2004-05

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Subscribe to Edeweiss Capital IPO: Networth

Networth Stock Broking has recommended subscribing to the initial public offering of Edelweiss Capital.

“We remain positive on the long term business potential of the broking industry and expect Edelweiss' growth momentum to continue in the coming years. At the upper band, the NBFC is priced at a PE of 35x its FY08 estimated earnings of Rs 23.2 and a price to book value of 3.9x,” says the brokerage report .

Edelweiss Capital is a diversified financial services company in India, providing investment banking, institutional equities, private client broking, asset management and investment advisory services, wealth management, insurance broking and wholesale financing services to corporate, institutional and high net-worth clients.

Issue proceeds will be used for enhancing margins with exchanges and expanding operations and network in addition to general corporate functions.

The price band of the issue is fixed at Rs 725-825 and it closes November 20