DAM Capital Advisors IPO analysis

DAM Capital Advisors IPO (initial public offering) will open for subscription on December 19, 2024, and close on December 23, 2024. Below is a breakdown of the investment bank's strengths, weaknesses and growth prospects to help investors make informed decisions. DAM Capital Advisors IPO in a nutshell Quality: During FY22-24, DAM Capital Advisors reported a three-year average ROE and ROCE of 30.1 and 41.3 per cent, respectively. Growth: During FY22-24, its revenue and profit after tax grew by around 39 and 79 per cent per annum, respectively. Valuation: At the upper end of the price band, the stock is valued at a P/E and P/B ratio of 28 and 10 times, respectively. Overview: Growth in AUM (assets under management) and public issues in India will help DAMS Capital Advisors scale up its business. However, high dependence on market conditions can hamper its growth prospects. About DAM Capital Advisors Incorporated in 1993, DAM Capital Advisors is an investment bank that primarily caters to merchant banking operations and institutional equities. Originally named S. S. Kantilal Ishwarlal Sharebrokers and Investors Private Limited, the company underwent several name changes before becoming DAM Capital Advisors Limited in 2020. Between November 2019 and October 2024, DAM Capital Advisors served as a book-running lead manager (BRLM) for 72 equity capital markets (ECM) transactions, which included 27 IPOs, 16 QIPs (qualified institutional placement), six offers for sale, six preferential issues, four rights issues, eight buybacks, four open offers and one REIT. Additionally, the investment bank has advised on 23 advisory transactions, including M&A, private equity and structured finance advisory. Strengths of DAM Capital Advisors Proven track record: Over the last five years, DAM Capital has acted as a book-running lead manager (BRLM) for 72 equity capital markets transactions, including 27 IPOs. Weaknesses of DAM Capital Advisors High dependence on market conditions: The company's growth and financials primarily rely on the volume of market issuances and the performance of equity markets. DAM Capital Advisors IPO details Total IPO size (Rs cr) 840 Offer for sale (Rs cr) 840 Fresh issue (Rs cr) - Price band (Rs) 269-283 Subscription dates December 19-23, 2024 Purpose of issue Offer for sale Post-IPO M-cap (Rs cr) 2,000 Net worth (Rs cr) 197 Promoter holding (%) 41.5 Price/earnings ratio (P/E) 28.4 Price/book ratio (P/B) 10.2 Financial history Key financials 2Y CAGR (%) FY24 FY23 FY22 Revenue (Rs cr) 38.9 180.0 84.9 93.4 EBIT (Rs cr) 83.6 94.7 12.9 28.1 PAT (Rs cr) 79.4