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.
In this article
- Aakash Exploration Services IPO Details
- Company Financials
- Objectives of the Issue
- Fund Utilization
- Important Dates
- Valuation of Peer Group Companies
- Promoters Average Acquisition Cost
- Promoters Stake Pre & Post Issue:
- IPO Valuation Parameters
- Subscription Details
- IPO vs Mutual Funds
- Different Funds
- Mutual Funds for 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.
Happy investing!
Disclaimer: the views expressed here are of the author and do not reflect those of Groww.
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