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Kaspi.kz IPO Case Solution & Answer

Kaspi.kz IPO

Unique and Important Challenges during the Public Offering

The corporation faced the following unique challenges when the KespiKz went through the initial public offering. All the challenges the company managed and increased the business’s growth and sustainability.

Balancing Quality and Growth

This was the prime challenge in the business model of the KespiKz. The company’s Founder was concerned about the quality of the transaction and the growth of business in Kazakhstan and on the London stock exchange. To control this challenge and improve the quality of trade and customer services, the KespiKz hires advisors from different countries.

Management of Money

By shifting from one business to another name, the company faces enormous expenses to change the nature and brand of its business.

At the start of a public offering, the company also pays the multiple costs related to trading in the stock market. In 2019 when the company started trading on the London stock exchange, the company’s Founder hired a professional Financial Analyst who completely handled the finances of the KaspiKz.

Timing of IPO Decisions

Managing the timing in making decisions related to the transformation of business and introducing public offerings in the market was also the unique challenge identified in the business model of KaspiKz. The Founder of the Corporation handles this challenge and manages the time for all the decisions that increase the corporation’s growth and expand the business in the emerging market of Kazakhstan and the international markets.

Downside to Delaying an IPO

As shown in the case study exhibit, the KaspiKz earned excellent revenue in 2018. Based on 2018 revenue, we forecast the revenue of the technological corporation. The results for the corporation are in favor of the Net Revenue of the KaspiKz increase from million to billion in coming years. The company’s current enterprise value is $39658 million, which is the major strength of the KaspiKz IPO. The financial prosperity of the company after introducing the IPO is much better than in previous years, so we can conclude that the company has the downside of delaying an IPO. If the company moves with this decision in the early years, the KaspiKz has double the growth compared to today’s change.

Right Time to Go Public

Yes, no doubt it is the appropriate time to go with a public offering because all the financial factors favor the KaspiKz. Forecasting future revenue also increases with good discounted factors and Enterprise value. The corporation can also expand its business in the United States and Singapore stock exchange market. The corporation has the competitive advantage of substantial market value and experienced and skilled Advisors, which helps the organization grow continuously in every market where they do its business.

Investment Banks

For selecting the investment bank, we should consider the three primary factors related to the credibility of the investment bank.

Quality of the Banking Team

Understanding the quality of the banking team is essential for the investors because every corporation is identified with its employees that why the investors must evaluate the quality of the banking team.

The Credibility of the Research Team of the Bank

The investors must understand the research team that can forecast the investment’s future growth. They have enough capability to find the Gap in the market and use investors’ investment in that field to generate more value for the investors and investment bank.

Internal Relationship between Managers

The internal environment of the bank is also essential for the investors because the managers share a good relationship with them; they also maintain good relationships with the bank’s investors. The excellent relationship of managers can attract more investors to the investment bank.

Role of Investment Bank in Initial Public Offering

The investment bank’s role in IPO is that the bank plays the role of a mediator between KaspiKzand the investors through the Initial public offering. The investment banks deliver the guaranteeing services for newly issued stocks when KaspiKz decides to go public and raise the corporation’s funding. The investment bank explains all the company’s terms and conditions to the investors and discusses the stock offering terms.

Investment Banks Requirements

In this process of Initial public offerings, a single investment bank is required. Because of that whole bank team facilitated the investors regarding the investment in any corporation. The investment bank plays the role of negotiator between the investor and corporation, whose main objective is to explain the investment factors to the investors and provide them underwriting services through which the investors like to invest in that corporation.

In this process, the KaspiKz decides to publicize the shares that investors buy with the help of an investment bank, which means three parties are involved. One is a corporation, the second is an investment bank, and the third is an investor.

Conclusion

After completing all the case requirements, we can conclude that the KaspiKz is a very profitable technological corporation that earns a lot of money through a public offering. With the Public Offering, the company’s value increased in the market in Kazakhstan, and the company attracted more investors towards the corporation. In 2018 the company started its public offering, which expanded rapidly, and the company gained the highest value in Kazakhstan and the whole world. Kaspi. Kz became the champion of Kazakhstan. In 2018 the Founder of the Kespi. Kz announces that in next year we enter in the international markets. The Kespi. Kz will do its first international trading on London Stock Exchange. In 2018, KaspiKz earned net revenue of $669 million from Fintech, Marketplace, and payments….

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