TLDR;
Namaste everyone! This IPO review by Sunday Investing covers three mainboard IPOs: Canara HSBC Life Insurance, Canara Robeco AMC, and Rubicon Research. The speakers share their fundamental perspectives, discussing business models, financials, and potential risks. The overall sentiment leans towards caution on the Canara group IPOs due to sector preferences and company-specific concerns, while Rubicon Research gets a strong thumbs-up.
- Canara HSBC Life Insurance: Complex, long-term play, but not favoured due to personal investment preferences.
- Canara Robeco AMC: Concerns about underperformance and market competition.
- Rubicon Research: Highly recommended due to its focus on regulated markets, strong growth, and complex formulations.
Opening Remarks [0:00]
The host welcomes viewers to the IPO discussion, setting the stage for reviewing three mainboard IPOs. These IPOs are of decent size, with two around ₹1300 crore and one around ₹2600 crore. The discussion will cover Canara HSBC Life Insurance, Canara Robeco Asset Management, and Rubicon Research. The host clarifies that this isn't qualified financial advice and viewers should do their own research.
Canara HSBC Life Insurance (Mainboard) [2:20]
Canara HSBC Life Insurance, incorporated in 2007, is a joint venture between Canara Bank and HSBC Insurance Asia Pacific. The IPO is a ₹2518 crore offer for sale (OFS) at a market cap of ₹10,000 crore, diluting 25% of the company. Key business verticals include individual life insurance, group insurance, and retirement products. 92% of the company's revenue comes from bank assurance, with 70-73% from Canara Bank and 19-20% from HSBC. The company's AUM stands at ₹43,600 crore as of June 31, 2025, with ULIPs accounting for 51%. The embedded value (EV) is ₹6353 crore, and the value of new business (VNB) margin is 19.5%. The solvency ratio is at 200%, higher than the guideline of 150%. The price to embedded value is 1.6 times, while peers like HDFC Life and SBI Life trade at 2.8 and 2.4 times respectively. The speaker is personally not inclined to apply, citing a dislike for insurance companies in their portfolio.
Canara Robeco AMC (Mainboard) [17:50]
Canara Robeco Asset Management, established in 1993, is a joint venture between Canara Bank (51%) and Orix Corporation Europe (49%). The IPO is a ₹1300 crore OFS with a market cap of ₹5300 crore. The company primarily earns revenue from management fees, charging 1-2% on equity schemes. AUM grew from ₹62,500 crore in FY23 to ₹1,03,000 crore in FY25, with equity schemes dominating. The company has 26-27 schemes, distributed through Canara Bank branches and 52,000+ distributors. Revenue jumped from ₹204 crore in FY23 to ₹440 crore in FY25, with a PAT of ₹190 crore. The IPO is priced at 27 times FY25 earnings and 20-21 times projected FY26 earnings. The speaker notes that while the valuation is decent, they are not expecting listing gains, but may still apply.
Rubicon Research (Mainboard) [32:20]
Rubicon Research, incorporated in 1999, is a pharmaceutical company focused on developing, manufacturing, and commercializing differentiated formulations, primarily in the US market (98.5% revenue). The company has 72 active ANDA approvals and 9 NDA approvals from the US FDA. Rubicon is the only Indian company with complete focus on the regulated market. The company has grown at 76% CAGR for the last 3 years. The product portfolio includes oral capsules, solutions, suspensions, and ophthalmic drops. The company has three facilities, all US FDA approved. The IPO size is ₹1377.5 crore, including a fresh issue for working capital and inorganic acquisitions. Revenue increased from ₹419 crore in FY23 to ₹1296 crore in FY25, with a PAT of ₹135 crore. The speaker is heavily bullish on this company, citing its complex formulations, high R&D expenditure, and potential benefits from the US Biocure Act. They plan to allocate 5% of their portfolio to this IPO.
Closing Remarks [30:00]
The host summarizes their IPO strategy, stating they will avoid the Canara group IPOs due to sector and company-specific concerns, but will apply to Rubicon Research. They also address concerns about potential impacts from farmer tariffs, suggesting the impact on Rubicon would be minimal. The session concludes with thanks to the viewers for joining.