Allegro capital advisor

A Report on

Allegro Capital Advisor pvt ltd

Presented by Nikhil Borawake MBA I, Div C

Allegro capital advisor

Contents

Sr. No.

Topic

Page No.

1 2 3 4 5 6 7 8 9 10 11

Finance Sector Overview Introduction Market Capitalization Service Profile Marketing strategies Company Deal Positional Analysis Best Practices Corporate Social Responsibility News Analysis References 19 11

4 5 8 8 9

12 14 15

25

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1. Finance Sector Overview:
Financial Sector of India is intrinsically strong, operationally sundry and exhibits competence and flexibility besides being sensitive to Indias economic aims of developing a market oriented, industrious and viable economy. An established financial sector assists greater standards of endowments and endorses expansion in the economy with its intensity and exposure. The fiscal sector in India entails banks, financial organization, markets and services. The sector is classified as organized and conventional sector that is also recognized as unofficial finance market. Fiscal transactions in an organized industry are executed by a number of financial organizations which are commercial in nature and offer monetary services to the society. Further classification includes banking and nonbanking enterprises, often recognized as activities that are client specific. The chief controller of the finance in India is the Reserve Bank of India (RBI) and is regarded as the supreme organization in the fiscal structure. Other significant fiscal organizations are business banks, domestic rural banks, cooperative banks and development banks. Non-banking fiscal organizations entail credit and charter firms and other organizations like Unit Trust of India, Provident Funds, Life Insurance Corporation, Mutual funds, GIC, etc.

Fig. Contribution of Each Sector to National GDP

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About Allegry
Allegro Advisors is a leading Indian full service investment bank that builds value across a spectrum of clients, including the government, corporations, financial institutions, high net-worth individuals and professionals.

Address:
Organization's Name : Allegro Capital Advisors Private Limited Products/Services : Investment, private, retail, investment management Website : http://www.allegroadvisors.com/ Headquarter : Banglore, India Year of Establishment : 2000 Corporate Address : 'C' Block, Silicon Terraces, 30/1 Hosur Main Road, Koramangla, Bangalore - 560 095, India Telephone : 91-80-60607888 Fax : 91-80-41216785

Introduction:
Allegro Advisors is a leading Indian full service investment bank that builds value across a spectrum of clients, including the government, corporations, financial institutions, high net-worth individuals and professionals. Comprehensive service offering Investment Banking, Capital Markets, Asset Management & Private Banking Ensuring client's financial well-being Team of experienced advisors Allegro Capital is a comprehensive Investment Bank that comes with years of expertise in offering financial solutions and advisory services across the corporate world. Allegro Capital Advisors has offices located in key metros across India. Our teams of financial advisors and specialists have the local knowledge, contacts and awareness to create optimum solutions that meet our client's

Allegro capital advisor

financial ambitions. Giving our clients the global local advantage, we have broadened our reach to 25 major cities and towns of India and established strategic alliances with several renowned advisory houses and institutions, internationally.

Sector and company position:

All figures are in Rs.cr Description Market Capitalisation P/E ratio 13.92 11.30 211.11 Net Profit Margin 10.54 10.20 32.52

Sector:Financial 83760.6 Industry:Money Center 44171.4 Banks (More Info) Allegro capital 477.3
Advisor ltd

Sourc:yahoo finance Profit and Sales Turnover : All figures are in Rs cr Sales turnover of allegro capital advisor is around 10-100cr rupees.

Services:
Allegros Services are broadly classified into: Capital Markets advisory services Corporate Finance Services Investment Advisory Services covering retail and corporate investment and wealth management . Asset Management that involves building a INR 1 billion restructuring fund

At Allegro, there is the realization that every one of its clients has a distinct financial goal broken down into unique needs, a distinct investment history, a defined propensity to save and finally a varying appetite at being exposed to investment risks.

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Allegro's approach at managing the wealth of its clients is built on the foundation that every one of its financial advisors is a custodian of his client's wealth. Further more, each client relationship is driven by the need to fulfill the financial goal that a client has set at the beginning of the relationship. And since the financial goal lays out an investment plan across an extended period of time, this relationship with a client is virtually set in perpetuity. Allegros' advisors are trained to take a highly analytical and solution - driven approach while making investment decisions for their clients, an approach that sees clients move closer to achieving their financial goal with every passing year. Allegro neither 'sells' financial products nor does it lay pre-conditions to investing. It's fee based advisory services ensures that it adopts a consultative approach to managing wealth. Advice therefore, is independent and client centric. Allegros' service offering is perhaps the widest in industry. The scope of its services encompasses the entire spectrum of financial needs of an individual right from planning to investing, managing and complying with Indian tax regulations. Allegro maintains perhaps the lowest client to advisor ratio in industry. Its multi tiered relationship approach ensures continuity in a relationship besides ensuring seamlessness so that a client is supported by expert whenever required.

Market capitalization:
We leverage our deep understanding of the capital markets and relationships with financial institutions to provide quality advice to our clients on transactions such as IPO advisory, private placements, etc IPO Advisory:
Business plan finalisation Review and finalise corporate and issue structure Appoint intermediaries, IPO documentation Assist in marketing and road shows IPO launch and post-IPO support including research and investor relations

Private placements:
Strategic assessment Identifying and approaching investors Pricing strategy and negotiations

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Merger and acquisition:

Allegro team's wide ranging investment banking experience, we are able to identify, execute and structure complex cross border transactions across a variety of geographies and jurisdictions. Our exclusive alliance with Close, further enables us to provide our Indian clients with access to a global pool of acquisition opportunities, and at the same time allowing international clients to access the Indian market.
Acquisition/ JV Advisory

Target identification and evaluation Contact with the identified target Structuring of the transaction Assistance in due diligence Documentation and execution Valuations and pricing strategy

Sell side advisory

Identification of buyers Contact with identified buyers Preparation of business plan and information pack Transaction structuring Due diligence coordination Valuations and pricing negotiations Documentation and execution

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Basic practices:
Kunal Kashyap, founder and CEO of Indian investment bank Allegro Advisors, discusses the firm's focus on wealth management and what advice he is giving his clients. What prompted Allegro to start offering wealth management services in India? We started Allegro with the vision of creating a full-service Indian investment bank so wealth management services were part of a suite of products we intended to offer our clients. When we started, we felt that the middleincome group was an attractive target segment for the following reasons: a. global wealth management firms were largely catering to the needs of only high-net-worth individuals b. the middle-income group was largely serviced by stock broking firms that offered speculative investment advice with little or no emphasis on financial planning c. we were bullish on India and felt that the middle-income group would be one of the biggest beneficiaries of the India story d. the middle-income group comprising the professional working class had neither the time nor the expertise to manage their finances e. financial institutions launching a slew of products in the marketplace further necessitated the need for an adviser to assist customers to choose the right product, and f. our belief, which has been confirmed, was that customers were willing to pay for objective, high-quality advice. The attractiveness of the segment, coupled with the fact it was a largely untapped market, made this an automatic first choice for our retail foray. How many people work in your private banking practice and what is your typical client profile? We have 80 relationship managers spread across 15 branches. We target working professionals in the age group of 25-35. What are your assets under management and across how many clients? We segregate our AUM into middle-income and high-net-worth clients. We currently manage Rs3 billion ($75 million) of money from 4,000 clients in the former category and Rs7 billion from 100 clients in the latter category.

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What advice are you currently offering your clients given the market volatility? We spend time trying to understand the risk tolerance of our clients our advice is based on how much volatility they have an appetite for. For clients with a long-term orientation, we advise buying equities on every dip. Equities are available at a discount to what we perceive as fair value for the first time in three years and offer very good value over a two-year time horizon. Some of these clients have hopefully benefited already from the recent rally. For clients for whom volatility is an issue we advise a staggered approach committing some funds to equities but maintaining the flexibility and liquidity to buy on large drops. We recently advised these clients to buy equities as the risk of these dislocations has, we believe, abated. We have also been advising clients to take advantage of higher rates and extend duration into longer maturities for fixed income. From a sectoral allocation perspective, we currently advise clients to stay away from rate sensitive sectors such as real estate and automobiles and focus on consumer spending related stocks and services. We think capital goods stocks are very cheap following recent corrections, given their strong order-book position. We believe gold is over-bought in the short run and have been advising clients to trim their gold holdings.

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2.Sanjeev Poddar Branch Head (Bangalore) Allegro Capital Advisors Pvt Ltd First you should have a mind of your own, you dont have to be a gambler or a financial cowboy. If you don.t know then you have to spend time learning about it. If you make a decision, live by it. The decision can go wrong in three or six months, but you have to decide that if I am a long term investor, a three-four month bad result should not matter. Next, you ask yourself if the time you have spent researching a company is worthwhile, or do you need professional help? Weigh out the cost part of it, the transaction part. If your decision is based on somebody else. advice then -give him independence but you must remain informed and you have to be intelligent to be an investor.

SWOT Analysis:
Strength It is one of the biggest business in India. It is portfolio up to 12 different investment companies. It includes huge number of employees. It is having merger and acquisition with 5 more companies to increase its growth. It elaborates its network throughout the world. Weakness Comparatively it has less branch offices geographically. Lack of penetration in rural areas Lack of Infrastructure as compared to established players. Opportunities Growing rural market potential. Urban youth with growing income. Threats Economic crisis and economic instability

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Entry of new NBFC in sector. Increasing awareness amongst people about securing their future.

Competitor:

Analysis of the Comparison

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It can be observed from Table 4.9 that most of the financial advisors are not charging any fees for their advisory services i.e. they are giving it free of cost because the banks (Citibank, UTI Bank, HSBC) earn commission if the customer purchases mutual funds, insurance, from it. The broking company earns brokerage if the client purchases RBI bonds etc or if he does any equity trading. The bank only charges marginal fees on the custodial services. However, HDFC Bank - instead of asking customers to bring in a specific amount of funds - charges customers on various types of services it offers. The management of wealth depends on the customer's risk appetite, his investment objectives. Once these are understood, the bank sends a written investment proposal on what the bank thinks the portfolio should be.

However, HDFC Bank do charge clients from Rs.35,000 a year for tracking portfolio up to Rs.35 lakh and Rs.1,00,000 for tracking portfolio up to Rs.1 crore. These services include equity-related services along with dedicated advisors. The bank also offers services between Rs.10,000 and Rs.25,000 per annum for non-interactive products. The bank, however, waives these fees if it earns money through transactions routed through the bank. Taxation advisory is given by very few players like Allegro, Bajaj Capital, UTI Bank. Various banks have a tie-up model with different insurance and mutual fund companies like Citibank has with Birla so Citibank will only sell Birla insurance to their clients irrespective of the fact whether the product meets the clients financial goals. Allegro is one player which takes care of loan restructuring. Commodity trading is only being handled by Religare as a separate product as SEBI have not yet allowed commodity trading to be a part of wealth advisory services. However banks cannot offer portfolio management services to customers. This means that a customer cannot give money to a private banker and ask the RM to invest on his behalf in different financial products. This service can be offered only by entities other than a bank such as Religare, Allegro Advisors, Bajaj Capital, etc. A banker therefore will have to call every time and get a written confirmation from the client before any deal is done.

Allegro in News 1.Biocon to focus on Biopharmaceuticals, divesting enzymes for USD 115 million to novozymes, 18th July 2007
Biocon announced today a definitive agreement to divest its Enzymes business vertical to Novozymes A/S for USD 115 million. This will enable Biocon to strategically focus on its core bio- pharmaceuticals business. 2.Batting for India: Indian companies are going global. A look at three acquisitive companies that epitomise the trend - Finance Asia, May '06 By the end of this decade we could see the deal value of India's cross-border M&A hit $25 billion annually - Kunal Kashyap, Allegro Capital Advisors. 3.India: Bumpy road to a future of prosperity As familiar as the Ambassador's bulbous curves may be, India's best-known saloon car lumbers far behind rivals. Of the country's 1.3m annual car sales, only 15,000 are Ambassadors, sold mostly to government officials and taxi services.

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4.India beats UK at Capital game - Sunday Telegraph INDIAN investment into the UK is poised to outstrip British investment in the subcontinent, reversing the flow of capital for the first time.

References: 1.www.allegroadvisor.com
2.www.sribd.com 3.www.businesstandard.com

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