Retail investors should go for CDSL IPO: Abhimanyu Sofat

Abhimanyu Sofat, VP-Research, IIFL, shares his views on the issues hitting the primary market this week. Excerpts:-

ET Now: There is going to be a lot of activity happening in the primary market this week. You got CDSL IPO, which opens today. You have got Eris Life, which will close later this week and AU Financiers’ issue will also open later this week. Anything on your radar?

Abhimanyu Sofat: I think CDSL is one IPO which looks pretty interesting. If you look at it, excluding the cash which is there on the balance sheet, the ROIC pre-tax is somewhere close to 100-odd per cent, which is pretty good, as good as something one would see in Crisil and all.

Considering the valuations at which the issue is available, I think it is a pretty good issue and most of the retail investors should go out and invest in this company.

Going forward, there is hardly any cash requirement for the business. It is duopoly business with NSDL and CDSL being the only two players right now in the market. It is a pretty good issue and will be my top pick among the issues currently in the market.