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       Incorporated in 2003, Prudent Corporate Advisory Services Limited provides retail wealth management services. The company offers Mutual Fund products, Life and General Insurance solutions, Stock Broking services, SIP with Insurance, Gold Accumulation Plan, Asset Allocation, and Trading platforms. Prudent Corporate Advisory Services provides investment and financial services platforms for the distribution of financial products through online and offline channels.

  The objects of the Offer are to :

 (i) to carry out the Offer for Sale; and

 (ii) achieve the benefits of listing the Equity Shares on the Stock Exchanges.

Our Company will not receive any proceeds from the Offer and all such proceeds will go to the Selling Shareholders.

           As on December 31, 2021, they had branches in 50 locations across B-30 cities with 108 relationship managers and 196 total employees at these locations. Since March 31, 2018, they have opened branches in 38 locations, of which 22 have been opened in B-30 markets, with a calibrated and progressive approach towards branch expansion.

• There is an outstanding criminal case in which the Economic Offences Wing has issued notices to Prudent Comder Private Limited (since merged with our Subsidiary, Prudent Broking Services Private Limited (“PBSPL”)), which if determined in an adverse manner, may result in a loss of license of PBSPL and consequently may adversely impact in future operations , reputation and profitability of the company.

• Company’s business operations are highly dependent on information technology. Failure or disruption of our Information Technology (“IT”) systems may adversely affect its business, financial condition, results of operations and prospects.

• Any reduction in  commission or brokerage of other financial products could have adverse effect on its business, financial condition, cash flows, results of operations and prospects.

• If techniques and processes for managing risks are ineffective, company may be exposed to material unanticipated losses.

• It may fail to detect money laundering and/or other illegal or improper activities in its business operations on a timely basis, which may have an adverse effect on the company.

• Company have outstanding dues to creditors, which if not paid may lead to claims against  the Company and in turn adversely impact  reputation and results of operations.

• Company have issued corporate guarantees in respect of certain bank guarantees submitted by our Subsidiary PBSPL, which if called upon, may subject  to additional liabilities and strain our cash flows.

• Company’s business operations are highly dependent on information technology. Failure or disruption Company’s insurance coverage may not be adequate to protect it against all potential losses, which may have a material adverse effect on the business, financial condition and results of operations.

               The company has focus on retail investors and SIP. The number of live SIPs on their platform being 15.3 Cr as of December 31, 2021, with the corresponding equity AUM from SIPs standing at 18949 Cr( representing 42.48% of the total equity-oriented mutual fund AUM) as of December 31, 2021. The number of active SIPs has increased from 0.079 Cr in Fiscal 2018 to 0.1030 Cr in Fiscal 2021 to 0.153 Cr as of December 31, 2021.

On the financial performance front, for the last three fiscals, PCASL has (on a consolidated basis) posted total income/net profits of ₹225.06 cr. / ₹21.02 cr. (FY19), ₹236.22 cr. / ₹27.85 cr. (FY20) and ₹294.90 cr. / ₹45.30 cr. (FY21). For the first nine months of FY22 ended on December 31, 2021, it has earned a net profit of ₹57.63 cr. on a total income of ₹328.00 cr. Thus, it kept enjoying higher margins on its business. 

For the last three fiscals, it has posted an average EPS of ₹8.56 and an average RoNW of 26.83%. The issue is priced at a P/BV of xx based on its NAV of ₹51.95 as of December 31, 2021, as well as post-IPO NAV and if we take FY22 EPS the IPO price , then it comes to  P/E of  33.94x which is in line with the peers , hence we recommend our clients to “Subscribe for long term”

 DISCLAIMER