The share price of this small-cap stock broker surged around 9 percent to an intraday high of Rs 665.30 apiece from its previous close after announcing a fund raise of Rs 300 crores and also approving a bonus equity share in the ratio of 1:1.
Share price movement:
The stocks of Monarch Networth Capital Limited has generated a return of 91 percent over the past year and a return of 16 percent over the last 6 months. With the market capitalization of the firm standing at Rs 2,211 crores, the shares of Monarch Limited closed at Rs 635 per share.
What happened:
As per the stock exchange filing published by Monarch Networth Capital Limited has announced a major fundraising of Rs 300 crores by issuing shares at Rs 560 apiece through a preferential allotment.
As per the filings, the promoter group entity Monarch infra-parks Private Limited contributed Rs 99 crore to the fundraising, and the rest Rs 25 crore was contributed by the CEO.
Additionally, the board has also approved a bonus 1:1 equity share with a face value of Rs 10 each for every one existing fully paid-up equity share of Rs 10 each. This means the shareholders of the company will receive one additional share for each share they currently own with the provided face values.
Why it matters:
These new funds will help Monarch Limited pursue a few goals such as to start a new portfolio management service (PMS), to grow its margin trading business, launch a fund for investments before IPOs ,apply for a Mutual Fund license, strengthen their Debt Capital Market division and support further IPO’s
Financials:
Comparing the financials of Monarch Networth Capital Limited from the current quarter to the previous quarter, the sales increased by 23.5 percent from Rs 68 crores in Q4FY24 to Rs 84 crores in Q1FY25. Also for the same period, the net profits generated by the firm also increased by 30 percent from Rs 31 crores to Rs 40 crores.
Ratios:
The trailing 12 months Return on equity and return on capital employed of Monarch limited stood at 36 percent and 39 percent respectively. For the same period, the debt to equity of the firm stood at 0.33 times.
Services provided:
Monarch Networth Capital Limited provides services in Equity and derivatives, commodities, currency derivatives, IPO, alternative investment funds, mutual funds, life insurance, general insurance, merchant banking, etc.
Shareholding Pattern:
As of June 2024’s shareholding pattern, the promoters, the FII, and the public held 55.93 percent, 0.13 percent, and 43.96 percent of the stakes of Monarch Limited respectively
About the Company:
Monarch Networth Capital Limited is a provider of financial services in stock broking, primary market operations, mutual funds, insurance and financial planning. It is a strategic amalgamation of two financial service providers Monarch Group of Companies and Networth Stock Broking Ltd.
Written By Zahal
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