Pinnacle Investment Management Group Ltd 

Investment Management firm, Pinnacle Investment Management Group Ltd (ASX: PNI), is known for the offering distribution, infrastructure and other support services to affiliated investment managers. The group has equity interest in about nine specialist investment managers and its Funds under Management has grown by 43% in FY18. The group’s managers have outweighed the benchmarks in last five years.
 
Acquired 35% interest in Metrics Credit & Raised fund:Pinnacle Investment Management Group Ltd (ASX: PNI) has acquired 35% equity interest in Metrics Credit Holdings Pty Limited (which owns 100% of Metrics Credit Partners Pty Limited) through its wholly-owned subsidiary Pinnacle Investment Management Limited for $46 million.
 
On the other hand, PNI has raised approximately $60.0m through the issue of approximately 10.9m new shares at an issue price of $5.50. Now the company is raising fund through Share Purchase plan at an issue price of $5.50, opened on 6 August 2018. The funds raised from placement of shares will be used for the acquisition of the 35% stake in Metrics Credit Partners and a 40% stake in Omega Global Investors, and will provide additional funding for future growth initiatives.
 
Additionally, for FY 18, PNI expects to report 92.5% growth in the NPAT from continuing operations to $23.1 million and gross funds under management of $38 bn as at 30 June 2018 compared to $26.5 bn as at 30 June 2017. Therefore, PNI stock has risen 19.02% in three months as on August 08, 2018. In last one year, the stock has risen about 85.6% and is now trading at a very high P/E (49.310x). The group is believed to be added to S&P/ASX 300 Index based on the continuous performance. Its gross FUM growth has been at 33% CAGR from FY15-FY18. While the group expects to diversify asset classes in terms of expanding through emerging and developing markets and growing absolute returns, the group may witness risks relating to acquisitions. Based on the foregoing, we give an “Expensive” recommendation on the stock at the current price of $ 6.020 and will evaluate the stock at a later date.


Aggregate Affiliate Revenue (Source: Company Reports)

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