The Sodhani Academy of Fintech Enablers IPO is set to attract considerable attention, focusing on financial literacy and awareness—a critical component in enabling individuals to make informed decisions regarding their personal finances. The IPO, a fixed-price issue amounting to ₹6.12 crore, is open for subscription from September 12, 2024, and will close on September 17, 2024. Sodhani Academy aims to raise ₹3.88 crore through a fresh issue of 9.7 lakh shares, while 5.6 lakh shares, amounting to ₹2.24 crore, will be sold through an Offer for Sale (OFS).

Key Financial Details

Issue Price: ₹40 per equity share

IPO Size: ₹6.12 crore

Lot Size: Minimum 3,000 shares

Minimum Retail Investment: ₹120,000

Minimum HNI Investment: 2 lots (6,000 shares), totaling ₹240,000

The issue has already garnered significant interest, with SRUJAN ALPHA CAPITAL ADVISORS LLP acting as the book-running lead manager, while Cameo Corporate Services Limited is the registrar for the IPO. Prabhat Financial Services Limited has been appointed as the sole Market Maker for the IPO, ensuring liquidity for investors in the post-listing phase.

The Grey Market Premium (GMP) for Sodhani Academy IPO has been fluctuating between ₹14 and ₹16, hinting at a potential listing gain of 35%-40%. However, investors should be cautious as GMP is an informal indicator based on demand and supply in the unregulated market and doesn’t guarantee future stock price performance. No real trading happens on this basis.

Business Overview
Founded with the mission to enhance financial literacy, Sodhani Academy of Fintech Enablers offers training, consultancy, and learning services in areas related to financial awareness. Their courses cover essential topics, helping individuals navigate the complexities of managing finances, investments, and budgeting. With the rapid evolution of fintech and growing demand for financial education, Sodhani Academy is well-positioned to benefit from its established presence in the sector.

Financial Performance
The financial health of Sodhani Academy has remained stable over the years. Its revenue grew from ₹188.19 lakh in FY22 to ₹306.95 lakh in FY24, showing steady growth in its core operations. Similarly, EBITDA increased from ₹173.40 lakh in FY22 to ₹241.27 lakh in FY24, while PAT rose from ₹123.91 lakh to ₹183.17 lakh over the same period, reflecting a solid operational performance.

Key financial metrics for the IPO include a pre-issue EPS of ₹3.88 and a post-issue EPS of ₹3.21. The Price to Earnings (P/E) ratio is pegged at 10.30x pre-issue and 12.46x post-issue, which is considered fairly priced given the industry average P/E ratio. The company’s Return on Capital Employed (ROCE) stands at 36.77%, and Return on Equity (RoAE) is at 32.33% for FY24, indicating a strong return on investments.

Subscription Status and Allotment
The IPO's subscription status has garnered significant interest from both retail investors and High-Net-Worth Individuals (HNIs). As of 00:00 PM on September 12, 2024, the IPO was subscribed 0.82 times on its first day, with more traction expected as the issue period progresses. Investors can track the live subscription status on BSE or NSE.

The IPO allotment will be finalized on September 18, 2024, with the allotment status being made available on the Cameo Corporate Services Limited website. To check allotment status:

Go to the IPO allotment status page on the registrar’s website.

Select the Sodhani Academy of Fintech Enablers Limited IPO from the dropdown list.

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

Submit the details to view your allotment status.

Once allotment is finalized, the shares are expected to be listed on the BSE SME on or about September 20, 2024.

IPO Objectives
The funds raised from the Fresh Issue will be directed towards the following purposes:

₹80 lakh for building a content studio and offline training infrastructure.

₹60 lakh for Information Technology (hardware and software procurement).

₹50 lakh for content development for courses and training material.

₹35 lakh for enhancing brand visibility and creating awareness about the company’s services.

₹10 lakh for developing a Learning Management System (LMS).

₹75 lakh for general corporate purposes.

Investment Recommendation
Given the company’s steady financial performance and its promising growth in the financial literacy sector, the Sodhani Academy of Fintech Enablers IPO may offer opportunities for both listing gains and long-term investment. The relatively low P/E ratio, combined with solid financial metrics like ROCE and RoAE, suggest that this IPO is reasonably priced.

However, this IPO is recommended primarily for risk-tolerant investors. The SME IPO market can be volatile, and listing gains are not guaranteed. Investors should consider their risk appetite and investment goals before subscribing to this IPO.

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