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Research04 Aug 2022
Is Rs. 170 a good price to invest in Unlisted Shares of Utkarsh Coreinvest?
UZ
UnlistedZone Research
Research desk
1 min read306 views
Please keep in mind that Utkarsh Coreinvest is a holding company for Utkarsh Small Finance Bank, whose stock is traded on the unlisted market. So, Utkarsh Small Finance Bank handles everything, and Utkarsh Coreinvest is merely a holding company.
Let us begin by calculating the value of Utkarsh Small Finance Bank.
(i) Net-Worth (Fy22) = 1571 crores
(ii) No. of Shares Shares (Fy22) = 89 crores
(iii) Book-Value (Fy22) = 1571/89 = 17.65 per share
(iv) 6.1 percent NPA (Fy22) (increased from 3.75 percent in Fy21).
If we give a P/B value of 1.5x to 2x, the per-share value of Utkarsh Small Finance Bank will be Rs.26-35.
M.cap = (26 or 35) *89 = 2300-3100 Cr.
In general, once a subsidiary is listed, the holding company values it at a 50% discount. As a result, Utkarsh Coreinvest should be valued between Rs. 1000 and Rs. 1500 crores.
M.cap in unlisted market = 1700 Cr ( at Rs. 170 per share)
Conclusion: The unlisted share of Utkarsh Coreinvest is currently overvalued in the unlisted market
Please keep in mind that Utkarsh Coreinvest is a holding company for Utkarsh Small Finance Bank, whose stock is traded on the unlisted market. So, Utkarsh Small Finance Bank handles everything, and Utkarsh Coreinvest is merely a holding company.
Let us begin by calculating the value of Utkarsh Small Finance Bank.
(i) Net-Worth (Fy22) = 1571 crores
(ii) No. of Shares Shares (Fy22) = 89 crores
(iii) Book-Value (Fy22) = 1571/89 = 17.65 per share
(iv) 6.1 percent NPA (Fy22) (increased from 3.75 percent in Fy21).
If we give a P/B value of 1.5x to 2x, the per-share value of Utkarsh Small Finance Bank will be Rs.26-35.
M.cap = (26 or 35) *89 = 2300-3100 Cr.
In general, once a subsidiary is listed, the holding company values it at a 50% discount. As a result, Utkarsh Coreinvest should be valued between Rs. 1000 and Rs. 1500 crores.
M.cap in unlisted market = 1700 Cr ( at Rs. 170 per share)
Conclusion: The unlisted share of Utkarsh Coreinvest is currently overvalued in the unlisted market
Disclaimer: This article is for informational purposes only and is not investment advice, nor an offer to buy or sell any security. Unlisted share prices are indicative. Please do your own research or consult a SEBI-registered advisor before investing.
