Subscribe to SKS Microfinance IPO:HEM Securities

MUMBAI – HEM Securities has advised investors to subscribe to the initial public offering of SKS Microfinance.

“SKS Microfinance is bringing the issue at price band of Rs 850-985 per share which will turn into P/E multiple of 31-36 at FY10 EPS of Rs 27.10. The company operates in high growth industry and has shown strong financial performance from last few years.

The topline as well as bottomline of the company has witnessed the CAGR of more than 100% from FY08 to FY10.

The company being one of the leaders in microfinance industry has high growth potential in future. Hence we recommend investors to “Subscribe” the issue,” the report said.

SKS Microfinance has entered the capital market to offer 16,791,579 shares in the price-band of Rs 850-985 per share. It plans to utilise the proceeds to augment capital base to meet future capital requirements and to achieve the benefits of listing on the stock exchanges. The issue closes Monday.