IIFL Wealth Management makes strong debut; shares hit upper trading limit

The listing of IIFL Wealth follows its demerger from parent IIFL Finance with IIFL Securities, with the latter set to list on Friday

IIFL Wealth Management, the country’s leading private wealth manager, made an encouraging debut on Thursday, with its shares hitting the upper trading limit. It ended at Rs 1,260, surpassing most price forecasts by analysts. The company is being valued at Rs 10,726 crore. The listing of IIFL Wealth follows its demerger from parent IIFL Finance with IIFL Securities, with the latter set to list on Friday.

Kotak Institutional Equities had forecast the stock to list much lower. “We reinitiate coverage on IIFL Wealth with fair value of Rs 1,050 per share (market cap of Rs 9,000 crore). At our fair value estimate, the business will trade at 19x earnings per share, or 2.7x its September 2021E book,” said a note.

IIFL Wealth managed assets worth Rs 1.7 trillion as of March 2019. It’s clientele includes the ultra-rich. “While volatility in the capital markets will constrain near-term asset growth, a promising advisory offering, an asset management business focused on alternatives, and a synergistic NBFC will all underpin yields,” the Kotak note said.