Top Tweets for #AceAlpha

ACE ALPHA TECH SME IPO BUSINESS REVIEW. 🌟AVOIDED. A non functional Pvt Ltd company named DM Prime Square Research & Analytics was taken over by the present promoters in 2023 and renamed it as ACE ALPHA TECH. From 2023, company started providing stock market trading software service to customers. Who developed trading software? How did the promoters get source code? Who owns IP Rights? Nothing is clear. No description of the software being property of ACE ALPHA TECH is mentioned anywhere. 🌟LIKE, READ FULL REVIEW & DECIDE This business review is based on DRHP/RHP filed by the company at Exchange & is based on reviewer’s understanding of the documentation. For a full understanding of risks, financials, objectives & prospects suggest to go through the RHP in detail & form own opinion OBJECTS: Out of Rs.32.22 Cr Raised 7.74Cr is OFS and 24.48Cr IPO. Out of 24.48Cr Rs. 12.5Cr for capex, the rest for Un Identified Acquisition, General and Listing Expenses. Reads like another inefficient, non focused fund raise with large amounts not properly accounted for.👎 And the promoters are quickly (after launching biz in 2023) taking 7.74Cr out👎 as OFS! Objects says such gems like "funds to buy 200 WINDOWS (!!)" (Are they really a software company? The language used in the RHP is very poor. No tech description of software👎 or its tech stack etc are explained) Rs.12.5Cr capex is to buy 200 PCs, 200 Windows Licenses, 30 Laptops and salary of 30 new employees for 1 year. BUSINESS: Buisness description and details given are not very clear. This is our assumption. The business seem to be to offer trading platform installed on computers which these people will provide to clients. As per RHP when they sign up a client for trading software, the client will need 6 servers. They will install software and also sell computers to their clients? Looks like a circus buying 200PCs using IPO funds and then reselling. They could as well get their clients to provide PCs and install software in that. Why get into hardware sales? Check the P&L. After starting in 2012, Rs.32L revenue in 2022 and Rs.4.8Cr in 2023. Then suddenly Rs.15Cr in 2024. For FY25, could not even provide annual result. Till Dec 2024, claims Rs.12.8Cr billing. All this with minimal employee cost And then taking out Rs.7.74Cr as OFS?? What sweat have they put in, to directly dilute equity resulting in Promoter Share Holding to fall to very low 43.9%? The fact is this Current Promoter has entered a non operational company in 2023 and got shares of original promoters transferred in his name and his private company Arika Securities. This is why there is no HISTORY of any software development or any such stuff. Who developed it? The promoter brought-in the Trading Software from somewhere and started offering service in 2023? In effect, the history of the development and legal ownership of the software is unknown. Does it belong to ACE ALPHA? How was the ownership/IP transferred, or its not transferred at all? If it is not transferred and belongs to promoter and what if he decides to do the biz in his "Narayan ventures"?! The Balance Sheet of ACE ALPHA does not show any software asset (intangible) or development costs incurred or any onetime investment made. The promoter is active in his own trading companies Narayan Capital and Narayan Comtrade. Employees? The Emp cost of Fy25 till Dec is 70L. Assume 100L for the year. Promoter is MD cum CFO. Give him 35 Lakhs. Balance 65L. How do you fit in software developers, Admin, HR, Legal , Sales& Marketing, Tech Support into this?!! Co says it has 26 people including 11 developers as of June 25 VALUATION & DECISION: At Rs.69, this is priced 14x its TTM earnings on post IPO equity basis. This appears like a rickety 3 wheeler. No idea whether it will go far or break down! AVOIDING since the IPO documentation is hazy. Is this a small IT? Hardware Seller, Software License Seller? Not clear! May take your own decision, after further study. IMAGES: P&L, BS