Motilal Oswal and Raamdeo Agrawal, the promoters of leading brokerage house Motilal Oswal Financial Services, will be worth Rs 700-800 crore (Rs 7-8 billion) each, after the company's initial public offer later this month.
The Mumbai-based brokerage house had set the price band for the IPO at Rs 725-825 apiece. At the price band, the company will have a market cap of Rs 2,059-2,840.4 crore (Rs 20.59-28.4 billion), making it the third most valuable domestic brokerage house, after Indiabulls Financial Services (Rs 12,785 crore) and India Infoline (Rs 3,174 crore).
Post-IPO, Oswal and Agrawal will hold nearly 70 per cent of the company. Oswal, in his individual capacity, will own 17.51 per cent (post-IPO) or 5 million shares in the company.
He also holds another 5 million shares in Passionate Investment Management, which has 35.25 per cent stake in the entity. At the lower end of the price band, this works out to be Rs 723.11 crore (Rs 7.23 billion). At the upper end, his stake translates into nearly Rs 825 crore (RS 8.25 billion).
Agrawal, who also owns almost similar equity stake in the company, will be worth similar to that of Oswal. Agrawal individually owns 16.92 per cent or 4.8 million shares in the company, in addition to his stake in Passionate Investment Management.
Motilal Oswal Financial Services, the holding company of four businesses - Motilal Oswal Securities (stock broking), Motilal Oswal Commodities Brokers, Motilal Oswal Investment Advisors (investment banking) and Motilal Oswal Venture Capital Advisors (private equity-cum venture fund), will raise Rs 216-245 crore (Rs 2.16-2.45 billion) through the IPO of 3 million shares.
In the stock broking space, the other listed companies include Geojit Financial Services (m-cap of Rs 841.23 crore), Emkay Share and Stock Broking (m-cap of Rs 255 crore), Networth Stock Broking (Rs 63.65 crore), JRG Securities (Rs 63.31 crore) and Arihant Capital (Rs 23 crore).
Some of the other broking outfits expected to hit the markets this year include Religare Enterprises, promoted by the Ranbaxy family, and Edelweiss Capital.
In its filing with Sebi, Motilal oswal said the fund will be utilised by the company to expand all streams of business ranging from equity broking, commodity broking, investment banking and venture capital fund management and advisory business. "The fund requirements of our subsidiaries are strategic in nature and in line with our growth strategy," it said.
