Beacon Trusteeship's IPO opens on May 28; check price bands, lot size, GMP

Beacon Trusteeship's IPO: Beacon Trusteeship's initial public offering (IPO) is set to open for subscription on Tuesday, May 28, 2024. The IPO is a book-built issue of Rs 32.52 crores, comprising a fresh issue of 38.72 lakh shares valued at Rs 23.23 crores and an offer for sale of 15.48 lakh shares valued at Rs 9.29 crores. 

The proceeds from the fresh Issue will be utilised for enhancing the technology infrastructure, acquisition of Beacon RTA Services Private Limited, purchase of new office premises and for general corporate purposes. 

Beacon Trusteeship is a debenture trustee offering trustee services in various areas such as security trustee services, trustee to alternate investment fund (AIF), trustee to ESOP, securitisation trustee, and other related services. 

 

The company operates in the business of providing services such as due diligence, custodial services, monitoring compliances, documentations, disclosures, record keeping. 

Here are five key things to know about Beacon Trusteeship's IPO

Beacon Trusteeship's IPO price band

The price band is set at Rs 57 to Rs 60 per share, with a minimum lot size of 2,000 shares and a minimum investment of Rs 1,20,000 for retail investors. HNIs are required to invest in a minimum of 2 lots of 4,000 shares, amounting to Rs 2,40,000. 

Beacon Trusteeship's IPO key dates

The subscription for the IPO opens on May 28, 2024, and closes on May 30, 2024, with allotment expected to be finalised on Friday, May 31, 2024. The IPO is slated to list on NSE SME on Tuesday, June 4, 2024. 

Beacon Trusteeship's IPO financials

The company’s revenues grew 33 per cent year on year (YoY) in financial year 2023-24 (FY24) to Rs 20.91 crores as against Rs 15.72 crores in FY23. Profit after tax soared by 34 per cent to Rs 5.1 crore in FY24 compared to Rs 3.8 crore in FY23. 

Beacon Trusteeship's IPO GMP

According to the Chittorgarh IPO, the last updated grey market premium (GMP) for Beacon Trusteeship SME IPO, as of May 27th, 2024, stands at Rs 65. Considering the price band of Rs 60.00, the estimated listing price for Beacon Trusteeship SME IPO is Rs 125 (cap price + current GMP, an expected listing gain of 108.33 per share. 

Beacon Trusteeship's IPO lead book runners

Beeline Capital Advisors Pvt Ltd serves as the book running lead manager, Kfin Technologies Limited as the registrar, and Spread X Securities as the market maker for the IPO.

So, should you subscribe to the IPO?

According to CoKaCo, a fundraising platform for startups and SMEs, short-term investors may apply for listing gains but an ‘AVOID’ approach is recommended for the medium to long term, with further due diligence needed on portfolio revenue stability and policy risk mitigations before a potential portfolio allocation. 

The company's substantial revenue growth with a 60 per cent compound annual growth rate (CAGR) during the past 3 years and stable earnings before interest tax depreciation and amortisation (Ebitda) margins  of 34 per cent, and PAT margins of 25 per cent in FY24 are indicative of company’s growing operations, bolstered by experienced management in a competitive sector, analysts at Cokaco noted. 

“However, more than 50 per cent of the revenue is coming from the debenture trustee segment and industry has high sensitivity to SEBI regulations policy. The company is operating in a niche segment by providing just trusteeship, compliance and few ancillary services,” CoKaCo said in a recent note.