Aakash Exploration Services Ltd is coming out with an Initial Public Offering on 17th April 2018.

The company plans to raise Rs. 10.08 crores by issuing 18 lakhs shares at Rs. 56 each. The minimum investment to be made by a retail investor is Rs. 1,12,000. The lot size was of 2000 shares and the issue will close on 19th April 2018.

Aakash Exploration Services IPO Details

Details Info
Issue Opens on 17th April 2018
Issue Closes on: 19th April 2018
Issue Price Rs.56
Face Value Rs.10
Minimum Lot 2000
Minimum Investment Rs.1,12,000
Issue Constitutes 26.67%
Issue Size Rs.10.08 cr
Market Cap Rs.37.8 cr
Listing at NSE SME
Equity Shares Offered 18,00,000
Equity Shares Prior 49,50,000
Equity Shares after the issue 67,50,000

Company Financials

Summary of financial Information (Restated)
Particulars For the year/period ended (in Rs. Lacs)
31-Mar-17 31-Mar-16 31-Mar-15 31-Mar-14 31-Mar-13
Total Assets 3,382.38 3,131.06 2,549.24 1,393.22 1,056.70
Total Revenue 3,380.30 2,563.31 2,345.20 1,389.54 944.65
Profit After Tax 110.02 44.32 101.44 49.38 14.40

Objectives of the Issue

  • Payment of Cash Credit Facilities.
  • Repayment of Unsecured Loans.
  • Working Capital Requirement.
  • General Corporate Purpose.
  • Issue Expense.

 

Fund Utilization

Particulars Amount (Rs. in Crores)
Payment of Cash Credit Facilities 3.0
Repayment of Unsecured Loans 2.0
Working capital Requirements 2.08
General Corporate Purpose 2.50
Issue Expenses 0.50
Net Proceeds 10.08 cr

Important Dates

Finalization of Basis of Allotment on or Before 24th April 2018
Initiation of Refunds on or Before 25th April 2018
Credit of Equity Shares: on or Before 26th April 2018
Listing Date: on or Before 27th April 2018

 

Valuation of Peer Group Companies

Company Name Face Value EPS PE Ratio RoNW NAV
Aakash Exploration Services Ltd 10 2.22 25.22 6.48% 34.28
Deep Industries Limited 10 24.66 7.84 19.57% 118.21
Selan Exploration Technology Ltd 10 5.28 42.99 3.07 172.08
South West Pinnacle
Exploration Limited
10 6.57 11.87 20.67% 31.80

 

Promoters Average Acquisition Cost

Name of the Promoter No. of Shares held Average Acquisition Cost (in Rs.)
Mr. Hemang Navin Haria 16,99,900 24.44
Mr. Vipul Navin Haria 25,39,900 20.03
Mr. Krunal Pravin Haria 5,49,900 22.24

Promoters Stake Pre & Post Issue:

Shareholder Name Pre Issue Stake (%) Post Issue Stake
Promoters
Mr. Hemang Navin Haria 34.34 25.18
Mr. Vipul Navin Haria 51.32 37.26
Mr. Krunal Pravin Haria 11.1 8.15
Promoter Group Entities              3.24           2.37
Total 100% 73.32%

IPO Valuation Parameters

Earnings Per Share (EPS) Price To Earnings ratio (PE) Return on Net Worth (RoNW) Net Asset Value (NAV)
2.22 25.22 6.48% 34.28

Subscription Details

Subscription category Wise Shares Offered
HNI 8,55,000
Retail 8,55,000
Others 90,000
Total 18,00,000

IPO vs Mutual Funds

If you have no knowledge of the equity markets but are looking to gain from the equity markets, mutual funds are ideal. Investments can be made in Mutual Funds since they provide a wide variety and also the amount of investment can vary as per investor’s preference.

Many mutual funds invest in IPOs – many times at discounted rates that are not available to retail investors.

It is necessary to not get carried away by the hype surrounding IPOs. Don’t jump into IPO if you do not have the necessary skills.

In a mutual fund, a skilled and trained professional handles all investments for you and therefore, you can benefit from the equity markets without spending too much time gaining the skills needed to understand the markets.

Different Funds

  • Large Cap Funds– Here the investment is made in large-cap companies. These companies have historically given returns between 12% and 18%. Moderate risk is involved and it is suggested to invest in these funds for more than 4 years.
  • Mid Cap Funds–Here the investment is made in mid-cap companies. These companies have historically given returns between 15% and 20%. The risk is slightly more than large-cap funds. It is suggested to invest in these funds for more than 5 years.
  • Small Cap Funds– Here the investment is made in small-cap companies. These companies offer 16-22% return. High risk is involved and it is suggested to invest in funds of this category for 6 years or more.
  • Balanced Fund– This fund is a combination of equity and debt in its portfolio. Depending on the proportion of investment made in equity and debt, the risk and returns are accordingly determined. It is suggested to invest here for 2 to 3 years. Returns observed in this category of funds ranges from 11% to 14%.

Investment can be made via lump sum investment or through SIP (Systematic Investment Plan) mode in any of these funds.

Mutual Funds for 2018

Large Cap Fund:

These funds invest in large companies that have a history of good performance and stable balances.

Mid Cap Fund:

These are funds that are high risk – high return. They’re a bit riskier than large-cap funds.

Small Cap Fund:

These are the funds that you can invest in if you want very high growth. They are a very high risk too.

If you want to see more funds to invest in 2018, check out: 30 best funds to invest in 2018.

Happy investing!

Disclaimer: the views expressed here are of the author and do not reflect those of Groww.