CCD issue: why it’s not every brokerage’s cup of tea

Our Bureau Updated - January 22, 2018 at 11:28 PM.

ccd-ipo-table

The public issue of Café Coffee Day (CCD) has evoked mixed response from brokerages. While some feel the issue should be avoided, a few recommend investing in the IPO, while some others are taking a neutral stance.

All in one cup For Prabhudas Lilladher, it is a clear case of ‘avoid’, due to unproductive investments, complicated organisational structure, and low throughput in the café business. India Infoline has taken a neutral stance, saying the issue is richly priced. “Investors with long-term horizon must monitor the stock post-listing for attractive entry points,” it said.

ICICI Securities recommends ‘subscribe’ to investors as it feels the company would be a major beneficiary of urban discretionary consumption.

Angel Broking also shares a “neutral” stance due to negligible profits/ reported losses of subsidiaries, complex holding structure and slightly higher valuation.

Ambit Capital cites limited head room in ROE improvement and operating levers as key concerns for its ‘avoid’ rating.

Published on October 13, 2015 17:28