💡 At a Glance
Ace Alpha Tech Ltd is trying to make money off the stock market… by selling tools to people who try to make money off the stock market. Their IPO is a ₹32.22 Cr book-building issue, with a fresh issue + OFS mix. But underneath the trading tech buzzwords lies a company with just 9 employees, sky-high margins, and suspicious transparency red flags. Techie brilliance or another B2B banana peel?
🎬 1. Introduction with Hook
“Sabko returns chahiye… koi system banane wale ki izzat nahi karta.”
Well, Ace Alpha Tech wants your izzat and your money.
They’re launching a BSE SME IPO with an issue size of ₹32.22 Cr and a fresh issue of ₹24.48 Cr. Price band? ₹65–₹69. Lot size? 2,000 shares. Minimum retail investment? ₹1.38 lakh.
But here’s the twist — while most tech companies beg for your money to build products, Ace Alpha’s already minting 70% net margins. On a ₹15 Cr topline. With 9 employees. And a mysterious sudden price band cut.
🔍 Is this a super-scalable SaaS rocketship? Or a beautifully dressed Excel sheet with no seatbelt?
🛠️ 2. WTF Do They Even Do? (Business Model)
Ace Alpha Tech isn’t making trading terminals for your chacha’s Zerodha account.
They serve:
- Institutional clients: With advanced order execution, risk tools, and portfolio management systems
- B2B brokers & retail platforms: Secure cloud-based trading tools
- Proprietary desks: High-frequency-ready risk engines & infra
- User management & compliance: Because everyone needs an “admin dashboard” today
In short: they build behind-the-scenes trading infrastructure for brokers and big traders. Not flashy. But potentially sticky.
But…
They’ve not named a single client in the RHP. No major brokerage shoutouts. Not even a mock screenshot of a UI.
Hmmm. 🤨
📊 3. Financials Overview – Profit, Margins, ROE, Growth
Let’s play “How to look like a unicorn with 9 staffers”:
| FY | Revenue (₹ Cr) | PAT (₹ Cr) | PAT Margin | ROE | ROCE |
|---|---|---|---|---|---|
| FY22 | 0.36 | 0.13 | 36% | — | — |
| FY23 | 4.94 | 3.32 | 67% | — | — |
| FY24 | 15.35 | 10.65 | 70.81% | 82% | 109% |
| 9MFY25 | 12.71 | 8.47 | ~67% | — | — |
💥 Explosive growth? Yes
🤨 Sustainable? Unclear
🤔 How are margins higher than TCS? LOL
Either they’ve built a fintech goldmine… or someone forgot to budget salaries.
💸 4. Valuation – Cheap, Meh, or Crack?
Let’s get dirty with numbers.
- IPO Price Band: ₹65–₹69
- EPS (FY24): ₹6.43 (post-issue)
- P/E (post-issue): ~10.73x
- Market Cap: ₹121.15 Cr
- Book Value: ₹69 ⇒ P/B = 1x
🧮 Fair Value Range Estimate:
Let’s assume FY26 PAT = ₹13 Cr (moderate 20% CAGR on FY24)
- At 12x P/E: ₹156 Cr Market Cap ⇒ FV = ₹89–₹91
- At 18x P/E: ₹234 Cr Market Cap ⇒ FV = ₹137–₹140
🎯 Fair Value Range: ₹89 to ₹140
Current IPO price of ₹69 looks… reasonable, IF numbers are real.
🔥 5. What’s Cooking – News, Triggers, Drama
- 🧊 Sudden Price Band Cut — First announced at ₹81–₹85. Then silently reduced to ₹65–₹69 before launch. Why?
- 🧑⚖️ Dilip Davda says “Avoid” — Called out transparency issues and shaky compliance.
- 🧍♂️Just 9 employees — For ₹15 Cr topline and ₹10 Cr bottomline? This isn’t OpenAI, bro.
📉 Not many QIBs showed up either. Day 2 QIB bids = zero.
🧾 6. Balance Sheet – How Much Debt, How Many Dreams?
| Metric | Mar 2024 |
|---|---|
| Total Assets | ₹23.02 Cr |
| Net Worth | ₹22.10 Cr |
| Debt | ₹0 Cr |
📦 Zero debt. Fat reserves. They’re raising ₹24.48 Cr fresh for…
🤷♂️ “Unidentified Acquisition” and vague “General Corporate” stuff.
Translation: “Trust us, we’ll figure it out.”
💰 7. Cash Flow – Sab Number Game Hai
Cash flow statements aren’t included in the RHP snippet, but based on 70% PAT margins and no capex or debt:
💡 They’ve likely got positive operating cash flows, no major investing cash burn, and negligible financing activity (till now).
But we’ll need actual post-IPO results to know if the cash is real — or just an accounting illusion.
📉 8. Ratios – Sexy or Stressy?
| Ratio | Value |
|---|---|
| ROE | 82% |
| ROCE | 109% |
| PAT Margin | 70.81% |
| EBITDA Margin | 95.98% |
| Price/Book | 1x |
| Post-IPO P/E | ~10.7x |
🚨 These are ultra-sexy ratios.
Almost too sexy. Especially for a B2B SaaS infra firm with zero visible brand recall.
💸 9. P&L Breakdown – Show Me the Money
FY24 Revenue = ₹15.35 Cr
PAT = ₹10.65 Cr
So what are they selling?
Apparently B2B trading infra tools. But:
- No product catalog
- No segment-wise revenue breakup
- No client name drops
- No ARPU data
Either they run an ultra-efficient cash cow…
Or it’s one big spreadsheet startup built to IPO.
🧪 10. Peer Comparison – Who Else in the Game?
Let’s try comparing with some public fintech-lite infra companies:
| Company | Rev (₹ Cr) | PAT % | P/E | Notes |
|---|---|---|---|---|
| KFin Tech | 800+ | 25% | 35x | MF infra & registry |
| CAMS | 1,000+ | 30% | 40x | RTA monopoly |
| Ace Alpha | 15.3 | 70% | 10.7x | 9 employees?! |
👑 Ace Alpha looks cheaper. But also way smaller, less transparent, and less regulated.
🧠 11. Miscellaneous – Shareholding, Promoters
- 👨💼 Promoters: Gaurav Sharma + Arika Securities Pvt Ltd
- 🔒 Pre-IPO Holding: 55.80%
- 🪙 Post-IPO Holding: 43.90%
- 🧲 Anchor Investors: ₹9.11 Cr raised. Lock-in till Sep 29, 2025 (for 50%).
Interesting: They diluted 12% promoter stake in one go. Not ideal if they’re playing long-term SaaS games.
🧨 12. EduInvesting Verdict™
🎭 Ace Alpha Tech = Fintech theatre or breakout infra hero?
If numbers are real, this could be a sleepy B2B cash cow with strong recurring revenue and no debt. The IPO is decently priced. But the drama around price band cuts, lack of transparency, and no client data raises yellow flags.
📌 Verdict: “Too Good to Be True” gets a techie twist.
🤷 It could compound. Or combust.
Either way, it’s more interesting than your average SME IPO.
✍️ Written by Prashant | 📅 June 30, 2025
Tags: Ace Alpha Tech IPO, SME IPO 2025, Ace Alpha Valuation, Trading Infra IPO, Ace Alpha Review, EduInvesting, Fintech IPOs, IPO Deep Dive, SME Listings
