Subscribe to ICICI Securities IPO : HEM Securities

ICICI Securities is a leading technology-based securities firm in India that offers a wide range of financial services including brokerage, financial product distribution and investment banking and focuses on both retail and institutional clients. Co have been the largest equity broker in India since fiscal 2014 by brokerage revenue and active customers in equities on the National Stock Exchange (Source: CRISIL), powered by its significant retail brokerage business, which accounted for 90.5% of the revenue from co’s brokerage business (excluding income earned on co’s funds used in the brokerage business) in fiscal 2017. As of December 31, 2017, ICICI direct, co’s award winning proprietary electronic brokerage platform, had approximately 3.9 million operational accounts of whom 0.8 million had traded on NSE in the preceding 12 months (Source: NSE). Since inception, co acquired a total of 4.6 million customers through this platform as of December 31, 2017.

Co’s retail brokerage and distribution businesses are supported by its nationwide network, consisting of over 200 of co’s own branches, over 2,600 branches of ICICI Bank through which co’s electronic brokerage platform is marketed and over 4,600 sub-brokers, authorised persons, independent financial associates and independent associates as at December 31, 2017. Co also offer its customers a wide variety of advisory services, including financial planning, equity portfolio advisory, access to alternate investments, retirement planning and estate planning.

Valuation

Co is bringing the issue at p/e multiple of almost 31 on post issue H1FY18 annualized eps at price band of Rs 519-520/share. Co being largest equity broker in India has strong and growing distribution business with an “Open-Source” Distribution & a leading institutional platform .Co’s strong financial performance with significant operating efficiency plays well for company. Hence, we recommend “Subscribe” on issue.

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