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Tag: Angel One Ltd

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9 things to know about Adani Wilmar IPO

Jan 28, 2022 by Gouri 0 Comments #Adani Wilmar, #Adani Wilmar IPO, #Angel One Ltd, #Mr. Amarjeet Maurya

Amarjeet Maurya

By – Mr. Amarjeet Maurya – AVP – Mid Caps, Angel One Ltd

The IPO frenzy in 2021 kept the investors in India exceptionally busy in dealing with initial public offerings (IPOs). A look at the draft red herring prospectuses (DRHPs) indicates that Q1 of 2022 is no different as two dozen companies are coming up with their IPOs during this time. Some companies announcing their IPOs include Oravel Stays (Oyo), Adani Wilmar, Emcure Pharma, Delhivery, etc.

The latest company to be listed is the ₹3,600-crore initial public offering (IPO) of Adani Wilmar. The FMCG company, which sells cooking oils under the Fortune brand, is a 50-50 joint venture between Gautam Adani’s Adani Group and Singapore-based Wilmar Group. Scheduled to open on January 27, the three-day public offering has fixed a price band of ₹218-230 a share for its IPO. The lot size – minimum number of shares that an investor can apply for – is 65 equity shares. Post the issue, the company’s market cap will be Rs 29,900 crores, and the shares are likely to be listed on the exchanges on February 08.

If you are planning to invest in Adani Wilmar, here are the 10 things you must know beforehand:

  1. Overview of the company

Incorporated in 1999, the FMCG company offers essential kitchen commodities for Indian consumers, including edible oil, wheat flour, rice, pulses, and sugar. The company also provides various industry essentials, including oleochemicals, castor oil and derivatives, and de-oiled cakes. The company offers products under a diverse range of brands across a broad price spectrum and cater to different customer groups.

Its product portfolio is categorized into (i) edible oil, (ii) packaged food and FMCG, and (iii) industry essentials. Fortune, the company’s flagship brand, is India’s largest selling edible oil brand. The company has increased focus on value-added products by launching products such as edible oil products, rice bran health oil, fortified foods, ready-to-cook soya chunks, khichdi, etc.

  1. Company presence

The company has 22 plants in 10 Indian states, comprising 10 crushing units along with 19 refineries. Its refinery in Mundra is one of the largest single-location refineries in India with a capacity of 5,000 MT per day. Adani Wilmar has also used 36 leased tolling units for additional manufacturing capacities as of September 31, 2021.

As of September 30, 2021, the company had 5,590 distributors in 28 states and eight union territories, catering to over 1.6 million retail outlets. Furthermore, the company had 88 depots in India, spread across the aggregate storage space of approx. 1.8 million square feet.

  1. Objective for IPO

The company wants to use the money to fund capital expenditure to expand existing manufacturing facilities and develop new manufacturing facilities. The funds will also be used for repayment/prepayment of borrowings, strategic acquisitions and investments, and general corporate purposes.

  1. Financials

The company’s revenue has grown at a CAGR of ~13% over FY19-21. On the profit front, the company has reported a strong Net Profit CAGR of ~39% over the same period. During 1HFY22, the company has reported strong top-line and bottom-line growth. However, the company’s EBITDA margin was volatile. The overall financial number looks good.

  1. Comparison with peer

Among the listed peers are Marico India and HUL. In terms of valuations, the post-issue TTM PE works out 37.6x (at the upper end of the issue price band).

  1. Competition

Adani Wilmar commands strong market leadership. The same has facilitated the company to source raw materials from top global suppliers from the international market. It has a senior management team with over 40 years of experience in the agribusiness industry. The Adani Group’s support also adds a few positives.

On the other hand, the Wilmar group is one of Asia’s leading agribusiness groups, which was ranked the seventh-largest listed company by market capitalization on the Singapore Exchange as of September 2021. Adani Wilmar will come face to face with a prominent player – Gemini Edibles, the world’s second-largest palm oil plantation company, which is planning to launch an IPO and raise around ₹25 bn.

  1. Growth Strategy

The company will increase its market share in the edible oils segment and expand the food business. In volume terms, edible oils contribute around 65% to the company’s business. The remaining comes from food and industrial essentials segments. Adani will also focus on emerging as the leading packaged food and FMCG company in India, expanding its distribution network with an omnichannel approach, increasing brand awareness, bringing new products and increasing its customer base.

  1. Lead managers

The book running lead managers for the company are ICICI Securities, HDFC Bank, BNP Paribas, Kotak Mahindra Capital, JP Morgan, BofA Securities and Credit Suisse. Link Intime India is the registrar to the issue.

  1. Shareholders quota

The company has reserved about 50% of the net issue for qualified institutional buyers (QIBs), 35% for retail investors, and the remaining 15% will be allocated to non-institutional buyers. It has reserved equity shares worth up to ₹107 crores for its eligible employees.

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business

Approaching The Stock Market From A Beginner’s Lens

Jan 18, 2022 by Gouri 0 Comments #Angel One Ltd, #investment, #Jyoti Roy, #Stock Market

By Mr. Jyoti Roy, DVP- Equity Strategist, Angel One Ltd

Investing in the stock market can be exciting and scary at the same time. While the returns are luring, the risk factor can be daunting. However, if you are somebody who is planning to venture into the stock market, then one of the first things that might come to mind is to learn the basics of investments in the stock market.

There are examples of people making a fortune and effectively generating a second source of income through a well-managed and directed approach towards stock market investments. However, stock market investments are subjected to market volatility and risk. For a beginner, it is crucial to practice caution and ensure that any decision to invest in the securities is backed by proper research and study.

Here are a few essential points that a beginner should take into account whilst approaching the market for the very first time.

Not over expecting from the stock market investments

Even though a balanced and planned approach in the stock market investments is often rewarding, it is also essential to understand that the market is not a magic wand or a genie. A beginner needs to realise that expecting long-term exponential results could be an incorrect approach to the entire investment journey.

Determining the initial investment

There are different ways for a beginner to initiate stock market investments. Either a lump sum amount could be invested in different shares, or a systematic investment plan could be followed. A fixed amount could be poured into securities such as equity shares and mutual funds. The first step before a beginner is to ensure how much money they would want to introduce in the stock market through any of the two methods.

Determining the investment goal

Even though this advice sounds pretty basic, any beginner must determine the exact objective for taking the big step of entering the stock market. The investment goal of an individual depends on risk preferences and life objectives. It could be a foreign trip or a dream house. It is not vital to have a grand purpose, but its determination before the investment journey could start is crucial.

Understanding different ways of stock market investments

There are several ways through which a beginner could approach the stock market journey. For example, a diversified portfolio could be created consisting of debt and equity securities. The beginner could also take account of index funds which are replicas of indices such as Sensex and Nifty and are operated by many financial institutions. You can also take advantage of Robo-advisors, which many Fintech players have introduced recently. These Robo-advisors are AI-powered mechanisms that take account of historical patterns and performance of individual stocks and suggest to the investors of the expected performance. Since some serious research and quantitative analysis back the advice, it is highly reliable.

Inclusion of diversification in the portfolio

Once again, this point could sound relatively straightforward; beginner investors often miss this out. Bullish sentiment in the stock market could result in upward movements in equities, indices, and derivatives. This could lure beginner investors into pouring more money than planned in the portfolios. However, it is always advisable to stick to the initial corpus that was decided in the first step.

Furthermore, putting all eggs in the same basket might provide a higher return (at times), but more often than nought, it can incur losses. Hence, it is crucial to have a balanced portfolio to enjoy the benefits of diversification. This means putting money in different options such as debentures, bonds (fixed market securities), equities (large, small and mid-caps) and index funds. The proportion of investment in each option is based on individual risk preference.

Avoiding too much risk at the beginning of the investment journey

It is advised to beginner investors to avoid high-risk securities such as futures and options. These derivative securities could incur high losses as there is no downward protection in such alternatives. The investor could lose the entire corpus, which is not possible when a diversified portfolio is created.

Tracking, reviewing, and monitoring the portfolio

Based on the planned period for which the investment is planned, a beginner should always track, review and monitor the securities’ prices and what the companies have been doing. For instance, if an investor has chosen Maruti Suzuki for investment, besides following the stock performance, it is essential to take account of various factors such as industrial and company-related news. This will help gain insights into the market and understand the reasons for price movements.

Summing up

The stock market investment could be extremely rewarding. However, it is also important to understand that there is no better teacher than learning from your own mistakes. Hence, a beginner should practice caution and enter the stock market in a planned and organised manner. The overall probability of incurring losses could be the least, and the chances of earning a reasonable return are higher.

Narayan-Gangadhar-CEO-Angel-One-1
business

6 Ways Big Data in Fintech is Creating a Better Customer Experience

Dec 24, 2021 by Gouri 0 Comments #Angel One Ltd, #Fintech, #future market trends, #Narayan Gangadhar

By – Mr. Narayan Gangadhar, CEO, Angel One Ltd

In an ever-evolving digital world, industries across all domains are stepping up to enhance their customers’ experience. It is especially true in the financial service industry, where everything from banking, payments, trading to wealth management has gone online. Increasingly, more fintech platforms are using data analytics to understand consumer behaviour and market trends with advancements in technology. It helps them improve their services and products, thereby meeting customer demands better.

Increasing use of smartphones and internet penetration creates heaps of data every day. It consists of structured and unstructured data, also known as a data lake or big data. Leveraging this, the fintech industry gains data-driven insights that help them make strategic decisions for enhanced customer experience. A report by Mckinsey states that data-driven organizations are 23 times more likely to retain customers and are 19 times more likely to bear profits.

Let’s dive deeper to understand 6 major ways in which big data analytics improves customer experience.

Enhanced view of customer profiling

Knowing the customer segment well is the first step in ensuring customer satisfaction. This is where big data analytics steps in. Fintech players can utilize big data to understand their customers’ wants and needs by creating customized consumer profiles. Details like demographics, risk perception, employment type, financial status, behavioural patterns, etc., can be considered while creating segments. As a result, it helps the fintech segment and customizes its offerings and services according to specific customer demands.

Better risk assessment

One of the biggest factors while participating in the fintech industry is managing risks. Using big data analytics helps in combining data from multiple sources and determining the potential risk factors. The risk assessment analysis further helps the fintech devise strategic plans to rule out the risk related to certain situations or market trends. Meanwhile, big data also minimizes the threat posed by unethical hacking practices by facilitating time-to-time risk assessment.

Improved security

Fraud is an oddly common problem in the financial services segment, be it online or offline. To rule this out, big data analytics can help the fintech industry develop a fraud detection system. By keeping a complete record of data, including location, history, device, transactional pattern, data analytics can raise a red flag in case of unusual activity. This helps in developing a customer-friendly secularized fintech ecosystem.

Along with this, big data analytics also facilitates risk assessment to ensure improved security. For instance, a credit risk management analysis combines the data from multiple sources to ascertain a CIBIL score that takes an individual’s credentials and financial behaviour into account. An accurate analysis of the data helps the fintech organizations determine whether the applicant will be able to repay the loan. This helps in assuring financial certainty while ruling out any bad lending decisions.

Forecasting future market trends

By gaining a deeper understanding of the past and present trends, users can even get a glimpse and form predictions about the surge or dip in the market. It helps the investors and traders make well-informed trading decisions, thereby improving their experience. Besides this, predictive analytics help streamline fintech operations like optimizing cash flow, offering competitive rates, etc., for improved customer retention.

Personalized assistance with chatbots

By employing AI and machine learning, fintech platforms can sieve through massive amounts of data to assist traders or investors. Some fintech platforms are also coming up with Robo-advisors to assist new-age investors in making well-informed decisions with the help of data analytics. Moreover, the fintech industry can also devise data analytics and forecasts to customize or suggest products as per a customer’s past financial behaviour.

Ensures friction-less multi-channel experience

While adopting fintech solutions, a lot of customers interact with multiple channels to avail financial services. Data analytics helps assess user patterns, time spent on the platform, consumer preferences, etc. As a result, fintech platforms can alter their offerings for personalized customer experiences. Besides this, with real-time data, fintech platforms can determine if customers face any problems or hindrances while using a particular feature, service, or user interface. This will help them devise an enhanced UX for a seamless customer experience.

Final Note

Data analytics has become the key enabler for rapid growth in the fintech industry. Stemming from real-time insights with big data, industries can enhance their services while improving the customer experience.