Aditya Birla Group’s AMC arm, Aditya Birla Sun Life AMC IPO will open for subscription on 29 September, at a price band of Rs 695-712 per share of face value of Rs 5 each. In the primary market, Aditya Birla Sun Life AMC shares were quoting at Rs 50 premium, over the IPO price. The shares were seen trading at Rs 762, a 7 per cent premium, over the upper band of the issue price, in the grey market, according to the people who deal in the unlisted shares of the company.
Aditya Birla Sun Life AMC issue will entirely be an offer-for-sale of up to 28.51 lakh equity shares by Aditya Birla Capital and up to 3.6 crore equity shares by Sun Life AMC. The public offer also includes a reservation of up to 19.44 lakh equity shares, for subscription by Aditya Birla Capital Limited (ABCL) shareholders. Investors can make bids for a minimum of 20 equity shares and multiples thereafter, implying a minimum investment of Rs 14,240 per lot.
Up to half of the net offer will be reserved for Qualified Institutional Investors (QIBs), 35 per cent for retail investors and remaining 15 per cent for non-institutional investors (NIIs). Kotak Mahindra Capital Company, BofA Securities India, Citigroup Global Markets India, Axis Capital, HDFC Bank, ICICI Securities, IIFL Securities, JM Financial, Motilal Oswal Investment Advisors, SBI Capital Markets and YES Securities (India) Limited are the merchant bankers to the issue. KFin Technologies Private Ltd will be the registrar to the issue. The price/earnings ratio based on diluted EPS on a restated consolidated basis for FY21 at the upper end of the price band is as high as 38.97 times.
The average cost of acquisition of equity shares for Aditya Birla Capital is Rs 2.30 and for Sun Life AMC is Rs 2.77 and offer price at upper end of the price band is Rs 712. The weighted average return on net worth for last three fiscals is 34.05 per cent. Upon listing, Aditya Birla Sun Life AMC could join the listed industry peers such as HDFC Asset Management Company, Nippon Life India Asset Management and UTI Asset Management Company.