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

DetailsInfo
Issue Opens on17th April 2018
Issue Closes on:19th April 2018
Issue PriceRs.56
Face ValueRs.10
Minimum Lot2000
Minimum InvestmentRs.1,12,000
Issue Constitutes26.67%
Issue SizeRs.10.08 cr
Market CapRs.37.8 cr
Listing atNSE SME
Equity Shares Offered18,00,000
Equity Shares Prior49,50,000
Equity Shares after the issue67,50,000

Company Financials

Summary of financial Information (Restated)
ParticularsFor the year/period ended (in Rs. Lacs)
31-Mar-1731-Mar-1631-Mar-1531-Mar-1431-Mar-13
Total Assets3,382.383,131.062,549.241,393.221,056.70
Total Revenue3,380.302,563.312,345.201,389.54944.65
Profit After Tax110.0244.32101.4449.3814.40

Objectives of the Issue

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

 

Fund Utilization

ParticularsAmount (Rs. in Crores)
Payment of Cash Credit Facilities3.0
Repayment of Unsecured Loans2.0
Working capital Requirements2.08
General Corporate Purpose2.50
Issue Expenses0.50
Net Proceeds10.08 cr

Important Dates

Finalization of Basis of Allotmenton or Before 24th April 2018
Initiation of Refundson 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 NameFace ValueEPSPE RatioRoNWNAV
Aakash Exploration Services Ltd102.2225.226.48%34.28
Deep Industries Limited1024.667.8419.57%118.21
Selan Exploration Technology Ltd105.2842.993.07172.08
South West Pinnacle
Exploration Limited
106.5711.8720.67%31.80

 

Promoters Average Acquisition Cost

Name of the PromoterNo. of Shares heldAverage Acquisition Cost (in Rs.)
Mr. Hemang Navin Haria16,99,90024.44
Mr. Vipul Navin Haria25,39,90020.03
Mr. Krunal Pravin Haria5,49,90022.24

Promoters Stake Pre & Post Issue:

Shareholder NamePre Issue Stake (%)Post Issue Stake
Promoters
Mr. Hemang Navin Haria34.3425.18
Mr. Vipul Navin Haria51.3237.26
Mr. Krunal Pravin Haria11.18.15
Promoter Group Entities             3.24          2.37
Total100%73.32%

IPO Valuation Parameters

Earnings Per Share (EPS)Price To Earnings ratio (PE)Return on Net Worth (RoNW)Net Asset Value (NAV)
2.2225.226.48%34.28

Subscription Details

Subscription category WiseShares Offered
HNI8,55,000
Retail8,55,000
Others90,000
Total18,00,000

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.