Shah Investor's Home Limited IPO

01At a glance

What the company does: retail equity and derivatives broking, depository services through NSDL, margin trading funding and distribution of mutual funds and portfolio schemes, from 11 branches and 181 authorised persons, almost all in Gujarat (RHP p.439, RHP p.443).

Who pays it: 38,189 active retail clients, of whom 36,720 are in Gujarat (RHP p.443). Broking was 64.78% of FY26 revenue, and Gujarat 93.74% of that broking revenue (RHP p.22).

Why it is raising money: ₹6,000.00 lakh for working capital, the whole of the stated objects, with an unquantified balance for general corporate purposes (RHP p.359).

How fast it has grown: revenue fell from ₹9,427.39 lakh in FY25 to ₹7,147.67 lakh in FY26, against ₹7,782.36 lakh in FY24, so revenue is about 4.2% a year lower across the two years and profit about 14.2% a year lower (our arithmetic, RHP p.371).

The one thing to understand: this is a broker whose best year in the record is the middle one. FY26 traded value fell from ₹59,44,704.02 lakh to ₹44,39,792.65 lakh and brokerage income by 29.73%, while SEBI's adjudication order of February 11, 2026 found the company had not upstreamed client funds as its circulars require and imposed a ₹4.00 lakh penalty, which has been paid (RHP p.598, RHP p.612).

02The business, in plain words

A retail broker executes clients' orders on the exchanges and charges brokerage on the value traded. It also holds clients' shares as a depository participant, lends against those shares under the margin trading facility, and earns commission for distributing mutual funds and third-party portfolio schemes (RHP p.440, RHP p.441). Much of the client gathering is done by authorised persons, the regulated name for sub-brokers, who are paid a share of the brokerage they generate.

A trader in Rajkot opens an account through an authorised person → the trader places orders on the company's platform → the company routes and settles them on NSE, BSE or MCX → the company keeps brokerage, and interest if the trader borrows under margin trading.

The company began as a trading member of NSE in 1995, became an NSDL depository participant in 1997, joined the BSE cash segment in 2004 and the futures and options segments of BSE and NSE in 2007 and 2008 (RHP p.441). It has four subsidiaries: SIHL Consultancy, SIHL Fincap, SIHL Global Investments (IFSC) and SIHL Strategic Advisors (RHP p.482). It had 167 permanent employees at July 31, 2026 (RHP p.462). During FY26 it launched ALGOFY, an application-programming-interface platform for algorithmic trading (RHP p.440).

Earnings equation: Profit ≈ traded value × brokerage rate + margin-funding interest + treasury interest + distribution commission − authorised persons' share − staff and technology cost. In FY26 fees and commission expense of ₹2,855.07 lakh was 61.7% of the ₹4,630.20 lakh of broking revenue (our arithmetic, RHP p.81, RHP p.442).

03Where the money comes from

Source: RHP p.81. The "other lines" row is our arithmetic on rental income, sale of products, sale of services and other operating income.

Stated by segment, the broking business was 71.57% of revenue in FY24, 68.85% in FY25 and 64.78% in FY26, and everything else 28.43%, 31.15% and 35.22% (RHP p.22). Concentration here is geographic, not by customer:

Source: RHP p.22, RHP p.443. The prospectus does not disclose revenue by client or the share taken by the largest clients, so customer concentration cannot be measured. Total customer assets held fell from ₹44,12,085.83 lakh at March 2024 to ₹39,45,883.47 lakh at March 2026 (RHP p.372).

04The growth record

Source: RHP p.371. Borrowings were ₹353.52 lakh, ₹570.81 lakh and ₹1,846.66 lakh at the three year ends, a debt-to-equity ratio of 0.02, 0.03 and 0.10 (RHP p.80, RHP p.371). Return on equity was 13.38%, 14.68% and 7.59%, and return on capital employed 16.77%, 20.35% and 10.61% (RHP p.371).

Our arithmetic over FY24 to FY26: revenue about 4.2% a year lower, EBITDA about 7.3% a year lower and profit about 14.2% a year lower; EBITDA margin fell 205 basis points and PAT margin 445 basis points (RHP p.371). The company states one growth figure of its own: customers added were 3,658, 4,552 and 4,865 in FY24, FY25 and FY26, which it describes as 15.30% compound growth in additions (RHP p.443).

05What the growth is made of

Traded value, and nothing else of comparable size. Traded value on the exchanges was ₹47,59,230.71 lakh in FY24, ₹59,44,704.02 lakh in FY25 and ₹44,39,792.65 lakh in FY26, and brokerage and commission income tracked it: up 15.68% in FY25, down 29.73% in FY26 (RHP p.440, RHP p.598, RHP p.600). The prospectus attributes the FY26 fall to “lower client activity and decreased traded value” (RHP p.598).

Two things moved the other way. Interest income rose 58.60% in FY25, helped by the introduction of the margin trading facility that year, then fell 6.03% in FY26 as fixed deposits were run down in line with trading volumes (RHP p.598, RHP p.600). The margin trading book grew from ₹964.22 lakh at March 2025 to ₹2,096.26 lakh at March 2026, with 476 active users against 219, interest charged at 18.00% and a default rate the company reports as 0.00% (RHP p.372).

Client numbers did not fall with revenue. Active clients were 35,535, 37,814 and 38,189 across the three years, so average broking revenue per active client fell from ₹17,165.95 in FY25 to ₹12,124.43 in FY26 (RHP p.372). Read from the filing: the business lost value traded per client, not clients.

06Earnings quality

Two lines need explaining. First, operating cash flow: a broker's reported operating cash flow moves with client balances rather than with trading, and the FY24 inflow of ₹11,019.42 lakh came largely from a ₹5,315.61 lakh rise in trade payables and a ₹2,899.84 lakh release of other bank balances, both of which reversed afterwards (RHP p.83). Second, receivables: trade receivables rose from ₹778.48 lakh at March 2024 to ₹2,689.38 lakh at March 2026 while revenue fell, and the prospectus does not separate client debits from other receivables (RHP p.80).

07The balance sheet

At March 31, 2026 total assets were ₹30,443.85 lakh, of which cash and cash equivalents were ₹6,429.16 lakh, other bank balances ₹5,993.69 lakh, investments ₹8,250.65 lakh, loans given ₹3,341.14 lakh and receivables ₹2,689.38 lakh (RHP p.80). Against that, trade payables were ₹10,278.98 lakh and borrowings ₹1,846.66 lakh, and equity ₹18,054.07 lakh including ₹83.41 lakh of non-controlling interest (RHP p.80, RHP p.614). Net worth attributable to owners was ₹17,970.66 lakh, or ₹114.07 a share (RHP p.370, RHP p.371).

Borrowings at July 31, 2026 were larger and differently shaped: ₹10,777.52 lakh on a consolidated basis, of which ₹6,000.00 lakh is a non-fund-based bank guarantee from HDFC Bank, ₹3,727.39 lakh is drawn fund-based facilities, mainly an overdraft against property of ₹1,223.76 lakh and a loan against securities from Tata Capital of ₹2,376.03 lakh, and ₹1,050.13 lakh is an unsecured inter-company loan (RHP p.608). Interest on the secured facilities runs at 8.75% to 10.00%, and all four promoters have given personal guarantees (RHP p.608, RHP p.609). Contingent liabilities were ₹6,424.88 lakh: the ₹6,000.00 lakh bank guarantee and ₹424.88 lakh of income-tax demands under appeal (RHP p.84).

After the issue: at ₹167 the fresh issue adds ₹9,016.66 lakh of gross proceeds to net worth of ₹17,970.66 lakh, ₹6,000.00 lakh of it as working capital in FY27; none of it repays debt (our arithmetic, RHP p.359, RHP p.371).

08What the money is for

Source: RHP p.359. The working capital is scheduled for deployment in full in FY27 (RHP p.359). The prospectus does not break the working-capital requirement into its parts on the pages read, and the fund requirement has not been appraised by any bank or financial institution (RHP p.360). There is no capital expenditure object, no debt repayment object and no acquisition object.

Into the business the whole issue: 53,99,200 new shares, ₹9,016.66 lakh at the upper band and ₹8,584.73 lakh at the lower (our arithmetic, RHP p.103). To selling shareholders nothing: there is no offer for sale (RHP p.77).

09Who is selling

No one. The issue is a fresh issue of 53,99,200 shares by the company, and no existing shareholder is offering shares (RHP p.77, RHP p.103).

10Promoters

The promoters are Upendra Trikamlal Shah, aged 73, Chairman and Whole-time Director; Tanmay Upendra Shah, aged 45, Managing Director and Chief Financial Officer; Purnima Upendra Shah, aged 76, Whole-time Director; and Trupti Utpal Shah, aged 50, Whole-time Director (RHP p.506, RHP p.507). Together the four hold 96,05,000 shares, 60.97% of the capital, and with the promoter group 1,32,86,400 shares, 84.34% (RHP p.281, RHP p.506).

The prospectus records experience of 30 years for Upendra Trikamlal Shah and Purnima Upendra Shah, 20 years for Tanmay Upendra Shah and over 17 years for Trupti Utpal Shah (RHP p.441). All four were identified as promoters by a board resolution of September 05, 2025, and the prospectus records no change of control in the last five years (RHP p.507).

Promoter economics: the holdings were built up from the 1994 incorporation onward at a face value of ₹10, with a 1:1 bonus issue in November 2007 and a second 1:1 bonus in November 2017 (RHP p.124, RHP p.158). The last allotment for cash was on February 29, 2008, at ₹150 a share (RHP p.128). In February 2021 the company bought back 13,16,800 shares at ₹55 each, taking the count from 1,70,70,800 to 1,57,54,000; Purnima Upendra Shah, Upendra Trikamlal Shah, Tanmay Upendra Shah, Ruchira Tanmay Shah and Tanmay Upendra Shah HUF were among the shareholders whose shares were taken in (RHP p.178).

Managerial remuneration paid to the four promoters was ₹188.90 lakh in FY24 and ₹180.00 lakh in FY26, and total director remuneration fell 39.26% to ₹195.24 lakh in FY26 (RHP p.87, RHP p.599).

The company has acquired two branch offices from the promoter family: one at Pethapur from Trupti Utpal Shah for ₹145.00 lakh under a sale deed dated April 12, 2025, and one at Junagadh from Ruchira Shah, the spouse of Tanmay Upendra Shah, for ₹70.00 lakh in September 2023 (RHP p.508). All four promoters have given personal guarantees for company borrowings (RHP p.609).

The prospectus records no criminal or material civil litigation against the promoters and no SEBI or exchange penalty on them in the last five fiscal years, but does record one direct-tax claim against a promoter of ₹3,423.05 lakh (RHP p.613, RHP p.614).

11Who already owns it

Source: RHP p.282. Promoters and promoter group together hold 84.34% and the public 15.66%, across 253 shareholders; 28,000 shares are still held in physical form (RHP p.281). There is no private equity, venture capital or institutional holder: the register is the founding family, families associated with it and individuals who came in through the issues of the 1990s and 2000s. On full allotment the count rises to 2,11,53,200 shares, and the promoters would hold about 45.4%, the promoters with the promoter group about 62.8% (our arithmetic, RHP p.103, RHP p.281). There is no employee stock option scheme (RHP p.280).

12What changed just before the IPO

• Revenue and profit turned down. Revenue fell 24.18% and profit before tax 41.70% in FY26 (RHP p.371, RHP p.599).
• The company entered margin trading in FY25 and the book more than doubled in FY26 to ₹2,096.26 lakh (RHP p.372, RHP p.441).
• SEBI's client-fund matter ran to a penalty. Inspections in December 2024 and January 2025, an observation letter, a show cause notice of October 31, 2025 and an adjudication order of February 11, 2026 imposing ₹4.00 lakh, since paid (RHP p.612).
• A Serious Fraud Investigation Office summons dated August 7, 2026 went to Utpal Praful Shah, a director who resigned on January 7, 2025, in an investigation into Kushal Tradelink Limited, for which the company acted as market maker from November 2014 until November 2025 (RHP p.611).
• The statutory auditor changed on September 29, 2025: Dhrumil A Shah & Co completed the maximum permissible term and Ashit N Shah & Co was appointed (RHP p.98).
• Registrar of Companies filings were corrected. Forms MGT-7 for several years misclassified promoter-group holders; corrected forms were filed on September 29, 2025, and an adjudication application over a Section 178 lapse was filed on November 19, 2025 (RHP p.33).
• Two branch offices were purchased from the promoter family, in September 2023 and April 2025, for ₹70.00 lakh and ₹145.00 lakh (RHP p.508).
• Borrowings rose from ₹570.81 lakh at March 2025 to ₹1,846.66 lakh at March 2026, and drawn facilities to ₹3,727.39 lakh by July 2026 (RHP p.80, RHP p.608).
• Dividend was raised to ₹1.50 a share, ₹236.31 lakh, between April 2026 and the date of the prospectus, against ₹1.00 a share in each of the previous three years (RHP p.511).

13Capacity and expansion

Nothing is manufactured. Capacity is capital, branches, authorised persons and technology. The network was 11 branches and 181 authorised persons at March 2026, with branches in Ahmedabad, Mumbai, Rajkot, Vadodara, Junagadh and Gandhinagar (RHP p.443). Authorised persons leave as well as join: 36, 17 and 31 ceased their association in FY24, FY25 and FY26, taking ₹30.10 lakh, ₹170.01 lakh and ₹59.65 lakh of revenue with them; no branch was closed in the three years (RHP p.462). The issue funds working capital rather than new offices, and the prospectus does not state a branch or authorised-person target.

14Market size and industry structure

As claimed: the CARE Report titled “Broking Industry in India” dated September 2026, commissioned and paid for by the company, records demat accounts in India rising to 1,991 lakh by June 2025, and the prospectus cites the report for NSE active clients reaching 479 lakh in the first quarter of FY26 (RHP p.399, RHP p.443). A copy of the report is on the company's own website (RHP p.439).

The part that is addressable: retail broking, depository and distribution customers in Gujarat, which is 96.15% of the client base, and to a small degree Maharashtra at 2.38% (RHP p.443). The prospectus does not size that market.

What the company is today: 38,189 active clients against the roughly 479 lakh active on NSE, and ₹7,147.67 lakh of revenue (RHP p.372, RHP p.443). On those two figures the company has under 0.01% of the country's active clients (our arithmetic, RHP p.372, RHP p.443).

The commissioned report describes a market reshaped by discount brokers taking share and commoditising core broking, with full-service firms responding by adding premium advisory for wealthier clients and digital arms for cost-sensitive ones, and with margin compression reaching even diversified firms (RHP p.416). Brokerage rates are also subject to exchange caps and net-worth requirements (RHP p.22).

15Competitive position

Source: RHP p.370. The three companies the prospectus names are 26.3, 20.6 and 2.9 times its size by revenue (our arithmetic, RHP p.370).

What the company offers in place of scale, on its own account: a client list built over three decades, of which 27,728 of 38,189 active clients have been with it more than five years; an in-house helpdesk; and 181 authorised persons who know their districts (RHP p.372, RHP p.443). Against that, brokerage is a price-competitive service, the company holds no registered trademark for the marks it trades under and has applications pending, and its directors including the independent directors have no experience of serving on the board of a listed company (RHP p.29, RHP p.58).

16Peers the company named

Peers named in the offer document: SMC Global Securities, Share India Securities and Arihant Capital Markets (RHP p.370).

All three are broking groups, which makes the set a fair one by business, and all three are far larger. Their price to earnings ratios on basic FY26 earnings, at NSE closing prices of August 31, 2026, were 16.28, 11.68 and 27.09, an average of 18.35 and a median of 16.28 (RHP p.370). Return on net worth was 7.82%, 12.28% and 7.13% against the company's 7.35%, so on that measure the company sits with the lower two (RHP p.370). The same three peers appeared in the draft, priced then at an average of 10.08 times earnings on March 28, 2025 (DRHP p.370).

17Valuation at the issue price

At the upper band of ₹167, with all 53,99,200 new shares added to the 1,57,54,000 in issue (our arithmetic, RHP p.103):

Source: RHP p.81, RHP p.103, RHP p.370, RHP p.371. At the lower band of ₹159 the market capitalisation is ₹33,633.59 lakh and the price to book 1.4 times (our arithmetic, RHP p.103, RHP p.370). Including the gross proceeds, book value after the issue would be about ₹26,987.32 lakh, ₹127.58 a share, and the upper band 1.3 times that (our arithmetic, RHP p.359, RHP p.371).

Enterprise value is awkward for a broker and is given here with its caveat: taking March 2026 borrowings of ₹1,846.66 lakh and cash and cash equivalents of ₹6,429.16 lakh, the company has net cash of ₹4,582.50 lakh, so enterprise value at the upper band is ₹30,743.34 lakh, 14.2 times FY26 EBITDA of ₹2,161.59 lakh; but client money passes through those bank balances, and the prospectus does not separate the company's own cash from it (our arithmetic, RHP p.80, RHP p.371).

Against the peers the prospectus itself names, at NSE closing prices of August 31, 2026: 16.28, 11.68 and 27.09 times FY26 basic earnings, a median of 16.28 (RHP p.370). On the enlarged share count the issue is at 26.8 times FY26 profit, 64% above that median; on the prospectus's own per-share basis it is at 19.9 times, 22% above it (our arithmetic, RHP p.370, RHP p.371).

18Risks, in plain words

Business, one segment in one state: broking is 64.78% of revenue and Gujarat 93.74% of broking revenue (RHP p.22) → a fall in trading in one state moves the whole company → FY26 traded value fell from ₹59,44,704.02 lakh to ₹44,39,792.65 lakh and revenue 24.18% (RHP p.598).

Regulation, and a finding already made: SEBI's adjudication order of February 11, 2026 held the company in breach of its client-fund circulars and imposed ₹4.00 lakh, paid (RHP p.612) → a broker's registrations depend on compliance → on 18 of 30 sample dates client funds were not upstreamed to the clearing corporations (RHP p.612).

Customers, brought by others: 181 authorised persons bring much of the business and the company can be held liable for their conduct (RHP p.25) → losing them takes revenue with them → 31 left in FY26, carrying ₹59.65 lakh of revenue (RHP p.462).

Financial, cash out of the door: operating cash flow was negative in both FY25 and FY26, at ₹3,186.22 lakh and ₹1,970.37 lakh (RHP p.371) → working capital has to be funded → borrowings rose to ₹1,846.66 lakh at March 2026 and drawn facilities to ₹3,727.39 lakh by July 2026 (RHP p.80, RHP p.608).

Credit, a new lending book: the margin trading book is ₹2,096.26 lakh with 476 users, collateral coverage of 153.75% and a reported default rate of 0.00% (RHP p.372) → collateral can fall in value faster than it can be liquidated → the book more than doubled in one year and the company entered the business only in FY25 (RHP p.31, RHP p.57).

Promoters and records: Forms MGT-7 for several years misstated promoter-group holdings, some historical corporate records cannot be traced, and an adjudication application over a Section 178 lapse is pending (RHP p.33, RHP p.50) → statutory records are the evidence of who owns what → corrected forms were filed on September 29, 2025 (RHP p.33).

Legal, an investigation next door: the Serious Fraud Investigation Office summoned Utpal Praful Shah, a director until January 2025, in the Kushal Tradelink investigation, and the company was that company's market maker from 2014 to 2025 (RHP p.611) → the outcome is not in the company's hands → no finding has been communicated to the company as at the date of the prospectus (RHP p.611).

Issue-specific: the amount for general corporate purposes is left blank, the working capital requirement has not been appraised by any bank, and the independent directors have not served on a listed board before (RHP p.58, RHP p.359, RHP p.360).

19Litigation and regulatory matters

There is no criminal litigation against the company, its subsidiaries, the promoters or the directors, and no material civil litigation against any of them (RHP p.611, RHP p.613). A 2008 preferential allotment to 502 investors that breached the Companies Act, 1956 and the disclosure guidelines of the time was settled with SEBI in May 2019 on payment of ₹12.19 lakh (RHP p.612). Income-tax demands of ₹424.88 lakh are carried as contingent liabilities under appeal (RHP p.84).

20Related-party transactions

Source: RHP p.86, RHP p.87, RHP p.88. The managerial remuneration and brokerage rows are our arithmetic on the recipients listed.

The relationship that dominates the table is with SIHL Fincap Limited, the wholly owned subsidiary, which lent the parent ₹40,347.92 lakh during FY26, 132.53% of total assets, all repaid within the year (RHP p.86). Brokerage paid to Arthika Quantomics Private Limited, a promoter-group company, rose from ₹23.67 lakh in FY25 to ₹116.50 lakh in FY26 while total brokerage payable fell, and brokerage previously paid to Sur Management Services Private Limited stopped (RHP p.86).

What appeared in the two years before the filing: the Arthika Quantomics brokerage, the Pethapur branch purchase from Trupti Utpal Shah in April 2025 and ₹36.17 lakh of expense reimbursement to Rajesh Ramchand Punjabi in FY26 (RHP p.86, RHP p.87, RHP p.508).

21What the offer document does not say

Revenue by client, or the share taken by the largest clients, is not disclosed, so customer concentration cannot be measured. The average brokerage rate, in paise per hundred rupees traded, is not disclosed. How much of the interest income is margin-funding interest and how much is treasury interest is not separated. The composition of trade receivables between client debits and other amounts is not given.

The parts of the ₹6,000.00 lakh working-capital requirement are not set out on the pages read, and the general corporate purposes figure and the issue expenses are left blank. Client attrition, as against active-client counts, is not disclosed. The prospectus does not say what changed in the client-fund process after the SEBI order.

22Five questions for management

1. What was the average brokerage rate on traded value in each of FY24, FY25 and FY26, and how much of the FY26 revenue fall was rate rather than volume?
2. What sits inside trade receivables of ₹2,689.38 lakh at March 2026, and why did the figure more than triple while revenue fell?
3. Of the ₹2,352.63 lakh of FY26 interest income, how much came from the margin trading book, how much from client delayed-payment charges and how much from bank deposits?
4. What changed in the client-fund upstreaming process after the SEBI order of February 11, 2026, and who signs it off daily now?
5. What parts does the ₹6,000.00 lakh working-capital requirement consist of, and what return does the company expect on it?

24Draft to final: what changed

The offer for sale, the objects themselves, the promoter group, the peer set and the sole lead manager, Beeline Capital Advisors Private Limited, are unchanged (DRHP p.93, DRHP p.370, RHP p.77, RHP p.97, RHP p.370).

1Sources and cited facts

This study was read from 1 document the company filed. The 103 figures it cites are listed under the document each came from, with the page and the sentence as printed.