Angel Broking IPO subscribed 77% on Day 1; no bids received from QIBs

NEW DELHI: The IPO by Angel Broking got subscribed 77 per cent in an otherwise weak session on Tuesday. The issue was able to attract bids for 1,05,01,287 shares on Day 1 of the bidding process, which was 77 per cent the issue size of 1,37,70,491 shares.

The retail portion was subscribed 1.46 times, while that reserved for non-institutional investors was filled in 16 per cent. There were no bids received from qualified institutional investors.

The broking firm, the previous day, had raised Rs 180 crore by allotting 58.82 lakh shares to 12 anchor investors.

"The company’s emphasis on providing clients with services through technological platforms has enabled it to rationalise the cost incurred and offer simplified and competitive pricing to clients along with value-added services," said Anand Rathi.

“We believe Angel Broking’s IPO and OFS is fairly priced at the current price band, considering its financial performance and growth prospects. We recommend a ‘subscribe’ rating on the IPO," the brokerage said. It, however, noted that the company has not been able to report growth in revenues and profits in the last three years.

YES Securities said the brokerage significantly outperformed the industry in terms of client additions with the share of incremental dematerialisation accounts increasing from 4.2 per cent in FY18 to 14.7 per cent in Q1FY21.

"However, it believes that high level of competition in the industry can restrict future growth opportunities for Angel Broking," it said.

The Angel's IPO comprises fresh issuance of shares worth Rs 300 crore and offer for sale of Rs 300 crore by promoters and other shareholders. The proceeds of the offer would be utilised for meeting working capital requirements and for general corporate purposes.