ICICI Securities IPO
This post on ICICI Securities Limited IPO tries to bring out consolidated brokerage views, List of Anchor Investors Grey Market Premium, Subscription information etc. The information collated from various sources and reports in public domain can help investors to decide whether they should subscribe to ICICI Securities Limited IPO or not.

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ICICI Securities Limited IPO: Grey Market Premium etc.

22/03/18 Grey Market Premium Rs.  NIL

Anchor Investors

Anchor Investors (AIs) portion in the Public Issue of ICICI Securities Limited 33,024,165 equity shares have been subscribed today by 58 AIs at Rs. 520/- per equity share. The anchor investors include Fidelity, Artisan, Fairfax, Nomura, Amansa & Blackrock. Some of the domestic investors include names like  HDFC MF, DSP Blackrock, Reliance MF, Premji Invest, SBI MF, Birla MF and IDFC MF etc.

Click here for Complete ICICI Securities Limited Anchor Investors List

Consolidated opinion of Brokerages, Analysts, Business New Paper Reports, Management Views on ICICI Securities Limited IPO .

Canara Bank Securities Ltd. “Brokerage income depends on general economic conditions, macroeconomic and monetary policies, market conditions and fluctuations in interest rates, all of which are beyond company control. High level of competition and new technologies may adversely affect the present brokerage revenues” 

Capital Market
: ” Score 45/100, The company’s CAGR in revenues between FY2013 to FY2017 was relatively slow at 19% compared with the comparable peer companies. But the CAGR PAT has been strong at 47%, with robust return on equity. 
However, profit of brokers fluctuates with sentiments in the market. The recent track record was supported by surge in liquidity. Growing in a pre-election year of FY 2019 on a very high base of FY 2018 will be very difficult for the industry..”

Choice Broking: • On valuation front, at higher price band, ISEC is demanding a P/E valuation of 34.7x (to its restated TTM EPS of Rs. 15), which is at a premium to the peer average. Moreover, with respect to FY18E and FY19E earnings too, it is asking a premium valuation. We are of the opinion that all the positives are already being factored in and there is a limited upside potential post listing. However, considering the growing equity cult in India, its positioning in the equity market, scalable & asset light business model, strong financial & return ratios and healthy dividend payout, we assign a “Subscribe with Caution” rating to the issue”

GEPL: “ICICI Securities Ltd (I-Sec) stands to gain from operating leverage. At a P/E of 32xs of annualized FY18 EPS. We believe that I-Sec is at a discount compared to its peers. We assign a Subscribe rating to the IPO.”

Kotak :At the higher end of the issue price of Rs 520 per share, the stock is being offered at 31.5x 9MFY18 annualized earnings. In the past two years, the broking industry in India has witnessed growth in terms of increase in new accounts, higher income from distribution business and sharp rise in primary market transactions. Activities in the capital markets business will remain a direct beneficiary of an improving macro environment, shift from physical assets to financial assets and stable government and its policies. Given ICICI Securities presence across the different segment and its customer base helps the company to explore new opportunities. We recommend Subscribe to the issue

Prabhudas Liladhar : “At upper band of Rs520, I‐Sec will trade at 34x FY18E EPS of Rs15 and 25x FY20E EPS of Rs21 which we believe is quite overpriced for its cyclical (equity) brokingbusiness which accounts for significant portion of its revenues. We recommend investors to AVOID the issue.

SMC : “
Rating 2.5/5 Being one of the pioneers in the e-brokerage business in India, along with its strong brand name, large registered customer base, wide range of products across asset classes, complimentary advisory services, and the company is sure to get benefit of the growth in digitization. However, the business of the company is cyclical in nature as the business of the company is heavily dependent on market sentiments. On the valuation front, since its peer companies are ruling at lower valuation, the issue looks pricey”

SP Tulsiyan website: “ICICI Securities’ business is heavily market dependent and hence cyclical in nature. Since more diversified plays are ruling at lower valuations, ICICI Securities IPO is not attractively priced, and hence can be skipped.

SSJ Finance:ICICI Securities has reported a CAGR of 18.8% and 47.4% on revenue and net profit fronts respectively over FY2013-2017. On its upper band of price of Rs 520, the issue is priced at PE ratio of 31.5x of its 9MFY2018 EPS of Rs 12.4. We believe IPO is fairly valued giving little upside to investor. Hence, we recommend to Avoid the IPO.

Standard disclaimer:  I am not a SEBI registered analyst and above analysis is for educational purpose only. I may have vested interest in every stock I discuss and my views may be biased. Please do your own due diligence as stock market investments have high degree of inherent risk.