Ahmedabad-based wealth management company Prudent Corporate Advisory Services is entering the capital markets with a Rs 539 crore initial public offering (IPO) on 10 May. This will be the first IPO from an Ahmedabad based company after Adani Wilmar in January.
The Prudent IPO consists of 8,549,340 shares of face value Rs 5 each at a price band of Rs 595-630. The IPO is an offer for sale from existing shareholders, private equity firm Wagner Limited (8,281,340 shares) and Prudent CEO Shirish Patel (2,68,000 shares).
Prudent is mainly in the business of distribution of mutual funds and acquired the mutual fund portfolio of Karvy Stock Broking through a bidding process conducted by a joint committee of the stock exchanges (BSE, NSE and MSEI) last year. Addressing a press conference in Ahmedabad on Thursday, chairman & managing director Sanjay Shah said the business had great growth potential. “When I started this company 20 years ago, people were not knowledgeable about mutual funds. Today, we have 13.5 lakh clients and mutual funds have become a cult,” he said.
With 110 branches and 1,067 employees, Prudent has grown to be a leading player in its field. Addressing the press conference, Chief Financial Officer Chirag Kothari said that besides mutual funds, the company’s insurance distribution business is also on the upswing. “The share of mutual funds distribution in our revenue was 88% in FY19. In the first nine months of FY22, the share has come down to 84%, mainly because of the increased share of insurance distribution,” he said.
Half of the Prudent IPO has been reserved for qualified institutional buyers (QIBs), 15 per cent for non-institutional investors and 35 per cent for retail investors. Besides, equity shares worth up to Rs 6.5 crore have been reserved for employees. Investors can bid for a minimum of 23 shares and in multiples thereof.
