Abans Holdings IPO | Key things to know before you subscribe | Value Research The non-operating holding company of the Abans Group has come out with an IPO. Read to find out if it's a good bet.
IPO Analysis

Abans Holdings IPO: Should you apply?

The non-operating holding company of the Abans Group has come out with an IPO. Read to find out if it's a good bet.

09-Dec-2022 •Udhayaprakash

abans-holdings-ipo-should-you-apply

Abans Holdings IPO: Should you apply?

About:
Abans Holdings is a non-operating holding company for the Abans groups' financial services companies. It primarily has three revenue sources:

  • Finance business (2.7 per cent of revenue) - lending services to private traders and SMEs.
  • Capital business (92.3 per cent of revenue) - internal treasury operation, i.e., invest the excess capital funds of Abans Group in various assets.
  • Agency business (5 per cent of revenue)- It provides institutional trading, wealth management and asset management services to corporates, HNIs and retailers.

Strengths:

  • Its integrated financial services platform allows clients to invest in a variety of asset classes. It also has tie-ups with various exchanges, such as BSE, NSE, MESI, etc.

Weaknesses:

  • High intercompany transactions: In FY22, 11 per cent of its revenue came from transactions with companies within the Abans Group.
  • Political contributions: The subsidiaries have made significant contributions to electoral bonds in the past. In FY21 and FY19, political contributions as a percentage of profits were 41 and 43 per cent, respectively.
  • Exposure to market fluctuations: The company derives most of its revenue from its capital business, which is highly exposed to fluctuations in the capital and commodity markets.
  • Unpredictable: It is extremely difficult to predict the performance of this entity as it is tied to the performance of the various subsidiaries.
Abans Holdings IPO
Abans Holdings IPO
Abans Holdings IPO
Abans Holdings IPO
Abans Holdings IPO

Disclaimer: This is not a stock recommendation. Do your due diligence before investing.

Suggested read: Sula Vineyards IPO

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