Share Samadhan Limited, India's largest organization specializing in the recovery of unclaimed investments, money, and assets, has launched its highly anticipated Initial Public Offering (IPO). The IPO opened on September 09, 2024, and will remain open until September 11, 2024. The company is offering an issue size of ₹24.05 crores, consisting of 32.51 lakh fresh shares. Investors are invited to participate in this Book Built Issue at a price band of ₹70 to ₹74 per equity share.

Share Samadhan was founded on November 11, 2011 (11.11.11), and has grown to become the only Public Limited company in the financial services sector that operates in the niche area of asset recovery. It serves a diverse range of asset classes and has a reputation for providing specialized services with a client-centric attitude. The company is focused on helping individuals, corporates, and financial institutions recover unclaimed financial investments and assets, making it a pioneer in this field.

IPO Details

The minimum lot size for retail investors is 1,600 shares, translating to an investment of ₹118,400. For High-Net-Worth Individuals (HNIs), the minimum required investment is 2 lots (3,200 shares), amounting to ₹236,800. The subscription period closes on September 11, 2024, and the allotment of shares is expected to be finalized on or about Thursday, September 12, 2024. Post-allotment, the shares will be listed on the BSE SME on Monday, September 16, 2024.

The book-running lead manager for this IPO is NARNOLIA FINANCIAL SERVICES LIMITED, while the registrar is SKYLINE FINANCIAL SERVICES PRIVATE LIMITED. Nikunj Stock Broker Limited serves as the sole market maker for the issue.

Share Samadhan’s Financial Performance

In terms of financial growth, Share Samadhan Limited has demonstrated strong performance over the last few years. Its revenue rose from ₹24,213.75 thousand in FY22 to ₹27,613.81 thousand in FY23, followed by an impressive surge to ₹99,612.57 thousand in FY24. Likewise, the company’s EBITDA grew from ₹5,847 thousand in FY22 to ₹7,830.19 thousand in FY23, before jumping to ₹52,372.03 thousand in FY24.

The company’s PAT (Profit After Tax), however, showed a slight decline in FY23, dropping from ₹6,069.86 thousand in FY22 to ₹4,792.48 thousand. Nonetheless, FY24 saw a substantial recovery with a PAT of ₹39,101.31 thousand. This financial trajectory is a testament to the company's ability to adapt and grow in a competitive market.

For investors, these financials translate to a pre-issue EPS (Earnings Per Share) of ₹4.63 and a post-issue EPS of ₹3.81. The pre-issue P/E ratio is 15.98x, and the post-issue P/E ratio is 19.42x, indicating a fair valuation when compared to industry standards. The company also boasts an ROCE (Return on Capital Employed) of 47.99% and an ROE (Return on Equity) of 34.64% for FY24, positioning itself as a financially robust entity.

Objectives of the IPO

The proceeds from the IPO will be used for various purposes, including:

Investment in technology – ₹41,000 thousand will be allocated to enhance the company’s technological capabilities, ensuring greater efficiency in asset recovery operations.

Unidentified acquisitions – ₹35,648 thousand will be reserved for potential acquisitions, either within India or internationally, to expand the company’s reach and service offerings.

Working capital – A significant portion, ₹79,000 thousand, will be used to meet the working capital needs of the company, enabling further expansion and operational stability.

General corporate purposes – Funds will also be allocated to general corporate purposes, ensuring flexibility and support for long-term growth.

Issue expenses – A portion of the proceeds will be used to cover expenses related to the IPO itself.

Subscription and Grey Market Premium

As of 05:54 PM on September 09, 2024, the live subscription status for Share Samadhan’s IPO shows that the IPO has been subscribed 1.10 times on its first day. The level of interest from investors is expected to rise as the subscription period progresses, reflecting confidence in the company’s financial performance and growth potential.

For those tracking the Grey Market Premium (GMP), the current range is estimated to be between ₹20 and ₹26 per share. This suggests that investors might expect listing gains of 30% to 35% based on the grey market sentiment. However, it’s important to note that Grey Market Premium is not an official measure of market value and involves unorganized trading. Therefore, while it can provide insight into market sentiment, it should not be solely relied upon for investment decisions.

How to Check Allotment Status

Once the allotment process is completed, investors can check their Share Samadhan IPO allotment status by following these steps:

Visit the IPO allotment status page on the registrar's website or stock exchange platform.

Select Share Samadhan Limited IPO from the list of IPOs.

Enter your application number, PAN, or DP Client ID.

Submit the details to view the allotment status.

This simple process allows investors to quickly determine if they have been allotted shares and plan their next steps accordingly.

IPO Review and Recommendation

Given Share Samadhan Limited's strong financial performance, niche market leadership, and growth potential, analysts are cautiously optimistic about the IPO. The company has carved out a unique position in the financial services sector, specializing in the recovery of unclaimed investments. With a pre-issue P/E ratio of 15.98x and strong return ratios, it appears to be fairly priced.

While the IPO offers potential listing gains, as indicated by the Grey Market Premium, it is recommended primarily for risk-tolerant investors seeking exposure to a specialized financial services company. Investors looking for long-term growth should also consider the company's ambitious expansion plans, which include technological investments and potential acquisitions.

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