The Hindu Business Line : JRG Securities announces Rs 14.50-cr public issue

The 14-year-old company, which undertakes integrated stock and commodity futures trading, expects to mobilise Rs 14.50 crore through the public issue, said Mr Reji Jacob, Managing Director of the company.

The issue is slated to open on April 17 and close on April 21. Keynote Corporate Services is the lead manager and Bigshare Services is the registrar to the issue. The funds raised will be used in technology upgradation, establishment of 30 new regional offices and overseas expansion.

Currently, the company has close to 400 branches, reporting to 12 regional offices. Through the expansion to 30 regional offices, JRG proposes to increase its branch network to 1,200 and extend its reach further in States such as Haryana. Gujarat, Rajasthan and Madhya Pradesh.

With strong focus on trading in commodity futures, the company already has a 50-branch network in Punjab, said Mr Giby Mathew, Executive Director of JRG.

The company also proposes to set up a limited liability company in Dubai to undertake stock market operations as well as establish a wholly owned subsidiary in DMCC Free Zone Area, Dubai, to undertake commodity broking operations.

The company, which is a member of the Dubai Gold and Commodity Exchange, plans to source clients from West Asia , India, US and Europe.

JRG reported a net profit of Rs 1.77 crore for 2004-05 and Rs 1.46 crore for the first nine months of 2005-06 when the prospectus was filed with SEBI. Earnings per share on an annualised basis for nine months ending December 2005 was Rs 2.13. The price-earning multiple on a post-issue basis would be 12.94. This is a sector which offers tremendous opportunities with some companies reporting PE multiple of 48, while the industry average remains close to 18, Mr Giby Mathew said. The book value of the company was 11.18 as on December 2005 and is slated to go up to Rs 19.35 post-issue.

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