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Friday, September 17, 2010

Should you buy IPO of Microsec Financial Services?

Checkout IPO information of Microsec Financial Services and whether you should buy IPO of the company.

Microsec Financial Services is entering primary market on Friday with an IPO of 12.5 million shares. The company has fixed IPO price band in the range of Rs 113-118 per share.

Issue Open: September 17, 2010
Issue close: September 21, 2010
Price Band: Rs. 113 - Rs. 118 Per Equity Share
Minimum Bid Size: 52 Equity Shares
Face Value: Rs. 10 Per Equity Share
Issue Type: 100% Book Building
Maximum Subscription Amount for Retail Investor: Rs. 100000

Microsec has a business model providing various financial products and services to client base of retail investors, high net worth individuals, companies and institutions.

The Company plans to use the proceeds for expansion of its financing business, expansion of Microsec Capital Limited's (a subsidiary of the company) domestic operations by increase in network of branches, enhancing Microsec Capital Limited's existing technological capacity and general corporate purposes.

IPO Rating
CRISIL has assigned an IPO Grade 2 to Microsec Financial Services Ltd IPO . This means as per CRISIL company has 'Below Average Fundamentals'.

Looking at IPO grading of 2 out of 5 indicating below average fundamentals, the IPO price seems to be costly for investors. I had a look at company website and the stock reports they provide. They claim to have a team of more than 10 - 11 investment analysts. Still they could not make their own stock offer attractive for retail investors! That is the most strange part of it. If these guys can not understand IPO grades and make it attractive for their retail investors in IPO, how much would they care for investors in future? When it comes to money, all conscience is lead by greed! You decide whether you want to buy IPO of Microsec, I am not going to buy it.

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