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Northern ARC Capital IPO: Things Smart Investors Need to Know

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Overview of the Company

Northern ARC Capital is a prominent player in the Indian financial services sector, specializing in asset management and financial advisory. Established with the vision of providing innovative and comprehensive financial solutions, Northern ARC Capital has carved out a significant market position. The company focuses on leveraging advanced analytics and robust financial strategies to cater to a diverse clientele, including retail and institutional investors. With a strong reputation for reliability and performance, Northern ARC Capital is well-positioned in the competitive financial landscape.

Northern ARC Capital IPO Details and Objectives

The Northern Arc Capital IPO is a Rs 777 crore book-built issue comprising a fresh issue of 1.9 crore shares worth Rs 500 crore and an offer for sale of 1.05 crore shares worth Rs 277 crore. Subscriptions open from September 16 to 19, 2024, with the allotment expected by September 20 and listing on BSE and NSE on September 24, 2024. The price band is set at ₹249 to ₹263 per share. The minimum investment for retail investors is ₹14,991 for 57 shares. Employees have a reserved share allocation at a ₹24 discount.

Key Dates to Remember

  • Northern ARC Capital IPO Opening and Closing Dates:
    • IPO Open Date: Monday, September 16, 2024
    • IPO Close Date: Thursday, September 19, 2024
  • Listing Date: Tuesday, September 24, 2024
  • Basis of Allotment: Friday, September 20, 2024
  • Initiation of Refunds: Monday, September 23, 2024
  • Credit of Shares to Demat: Monday, September 23, 2024

Pricing and Lot Size of Northern ARC Capital IPO

  • Price Band for the IPO: The price band is set between ₹249 to ₹263 per share.
  • Minimum Lot Size and Application Details:
    • Retail Investors: Minimum lot size is 57 shares, requiring an investment of ₹14,991.
    • Small and Non-Institutional Investors (sNII): Minimum investment is 14 lots (798 shares), totaling ₹209,874.
    • Big and Non-Institutional Investors (bNII): Minimum investment is 67 lots (3,819 shares), amounting to ₹1,004,397.

How to Apply for the Northern ARC Capital IPO?

Applying for the Northern ARC Capital IPO is a straightforward process. Investors can apply through various channels, including online platforms and brokerages. Follow these steps to apply:

  1. Check Eligibility: Ensure you meet the eligibility criteria set by the company.
  2. Register: Create an account on the IPO application platform or with your broker.
  3. Fill Out the Application: Provide necessary details and select the number of shares you wish to apply for.
  4. Make Payment: Pay the application amount through the available payment methods.
  5. Submit Application: Submit your application and keep track of its status through the platform.

Financial Health and Performance

  • Revenue Growth: Increased by 45% to ₹1,906.03 crore in FY 2024 from ₹1,311.20 crore in FY 2023.
  • Profit After Tax (PAT): Rose by 31% to ₹317.69 crore in FY 2024 from ₹242.21 crore in FY 2023.
  • Assets: Total assets grew to ₹11,707.66 crore as of March 31, 2024, up from ₹9,371.57 crore.
  • Net Worth: Increased to ₹2,314.35 crore in FY 2024 from ₹1,955.39 crore.
  • Total Borrowing: Rose to ₹9,047.76 crore from ₹7,034.57 crore.

Northern ARC Capital’s robust performance and growth in revenue and profit highlight its strong market position and potential for future expansion.

Investment Risks and Opportunities

  • Potential Risks of Investing in the IPO:
  • Market volatility can affect share prices.
  • Regulatory changes may impact the company’s operations.
  • Competitive pressures could influence financial performance.
  • Economic conditions and financial market fluctuations might affect growth.
  • Opportunities and Growth Potential:
  • The IPO offers exposure to a major financial services company.
  • Strategic initiatives and market positioning indicate potential for growth.
  • The company’s expansion plans, and investment strategies may drive future returns.

Conclusion

The Northern ARC Capital IPO presents a significant opportunity for investors interested in the financial services sector. The company’s recent financial performance and planned use of proceeds indicate a focus on growth and expansion. However, as with any investment, there are risks involved. Potential investors should assess their investment goals and evaluate the company's prospects before participating in the IPO.

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Frequently Asked Questions

What is the Northern ARC Capital IPO and why is it significant?

Answer Field

The Northern ARC Capital IPO is a book-built initial public offering aiming to raise up to ₹777 crore by offering shares of Northern ARC Capital. It is significant as it provides an opportunity for investors to acquire shares in a key player in the financial services sector and supports the company's growth and expansion.

What is the price band for the Northern ARC Capital IPO, and how was it determined?

Answer Field

The price band for the Northern ARC Capital IPO is set between ₹249 and ₹263 per share. This range was determined based on the company’s valuation, market conditions, and investor interest, ensuring a balance between attractiveness to investors and the capital requirements of the company.

What are the key risks and rewards of investing in the Northern ARC Capital IPO?

Answer Field

Key risks include potential market volatility and regulatory changes that could affect the company's operations. Rewards may involve capital gains and exposure to a prominent financial services company with promising growth prospects, contingent on the company's post-IPO performance.

When will the Northern ARC Capital IPO shares be listed, and what is the expected market response?

Answer Field

The Northern ARC Capital IPO shares are expected to be listed on September 24, 2024. The market response will depend on investor sentiment and the company’s performance, with initial trading reflecting the overall demand and market conditions.

What documents should I review before investing in the Northern ARC Capital IPO?

Answer Field

Before investing in the Northern ARC Capital IPO, review the Draft Red Herring Prospectus (DRHP) for detailed information about the company’s financials, risk factors, and the terms of the IPO.

What are the lock-up period details for Northern ARC Capital IPO?

Answer Field

The lock-up period for the Northern ARC Capital IPO generally restricts major shareholders and insiders from selling their shares for a certain duration after the IPO. This measure aims to stabilize the stock price and ensure a smooth transition to public trading.

How will the Northern ARC Capital IPO impact existing shareholders?

Answer Field

Existing shareholders may experience changes in their ownership percentage due to the issuance of new shares in the IPO. The impact will depend on the amount of new capital raised and the overall performance of the company post-IPO.

Will Northern ARC Capital IPO pay dividends?

Answer Field

Information about Northern ARC Capital IPO dividend payments will be outlined in the company’s post-IPO announcements and financial statements. Investors should check these documents for details on any future dividend policies.

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