Thebullishtrends: Future Capital is the first Indian IPO of the new year'2008. Future Capital is entering into IPO market today by offering shares of Rs.10/-face value with a price of band of Rs. of Rs700-765 each. ICRA has assigned an average rating 'Grade 3'for Future Capital Public issue.Future Capital Holdings Ltd, the financial arm of the Future Group, which belongs to India’s largest listed retailer Pantaloon Retail India Ltd, will make this year’s first initial public offering (IPO) in the capital market with its Rs449-490 crore float.. The company is offering 64,22,800 shares, offering a 10.16% stake to the public with a price band of Rs.700-765 which puts the company’s valuation at between Rs4,490 and Rs4,900 crore.
Future Capital has two major businesses—private equity and consumer finance—and is developing malls, hotels and townships. Its $850 million domestic Kshitij Fund is building 11 malls in tier II cities, and the $350 million Horizon Fund is building at least four mixed-use townships. The company’s $400 million Indivision funds buy stakes in consumer businesses.
Future Capital also plans to launch a $350 million fund to build hotels. The Future Capital IPO will kick off another potentially big public offering season, as Reliance Power Ltd public issue, estimated to be around Rs11,700 crore, will open soon after.
Future Capital's private equity business is very attractive. “They have focused their
private equity business on the consumer space where they have a specialisation.” But, the company’s consumer-finance business raised some short-term growth concerns because of recent interest rate hikes.. The Future Capital issue will bring down the stake of Pantaloon Retail, currently the Future Group’s only listed company, to 55% from 61.23%.
Following the IPO, the stake of the promoters, Kishore Biyani, Promoter of the group, will come down to 5.97% from 6.64% and Sameer Sain, chief executive of Future Capital, to 13.49% from 15.01%. Pantaloon’s share price has zoomed 103.37% in the past year, fuelled by growth in the retail industry and the planned public offerings of Future Capital and Future Ventures Ltd, a company that will invest in listed equities.
Having high promoter stake, and fancy about this group stock in the capital market, it's strong presence in the Investment Advisory Services,Retail Financial Services and Research ares. Future Capital is offering shares with reasonable price, and the proposed issue funds Rs.491 cr will enhance the company's business growth prospects in the coming months. Apply aggressively and make bids at higher level for this IPO as we are expecting heavy subscriptions for this issue.
Thebullishtrends is strongly recommending FUTURE CAPITAL IPO
