Hexaware Technologies ₹9,950 Crore IPO: DRHP Filing and What’s Next
Sep 19, 2024
Hexaware Technologies, a prominent provider of IT offerings, has submitted its Draft Red Herring Prospectus (DRHP) to the Securities and Exchange Board of India (SEBI) for an IPO valued at ₹9,950 crore. The upcoming Hexaware Technologies IPO is a big landmark occasion, representing the business enterprise's re-entry into the public market following its delisting in 2020. The public offering is only carried out as a proposal on the market by CA Magnum Holdings, a subsidiary of the Carlyle Group, that owns 95.03% of Hexaware.
Company Overview
Hexaware Technologies, primarily based in 1990 and focused in Navi Mumbai, India, is a main worldwide company of IT and industrial employer manner outsourcing offerings. The organization offers a wide kind of services, such as digital transformation, cloud services, information and AI, and organization IT solutions. With a robust interest in leveraging artificial intelligence (AI) and digital generation, Hexaware serves numerous consumers, which encompass 31 Fortune 500 businesses. The organization has an worldwide presence with 61 offices globally and employs over 31,000 experts. Hexaware Technologies has a vast presence in diverse sectors alongside banking, economic services, coverage, healthcare, and manufacturing.
Hexaware Technologies IPO Details
The IPO worth ₹9,950 crore is a complete offering in the market through CA Magnum Holdings. This approach means that the earnings from the IPO will be given to the promoting shareholder instead of the business entity. The main goal of the IPO, as mentioned in the DRHP, is to take advantage of listing equity shares on stock exchanges and provide an exit opportunity for existing shareholders.
If successful, this IPO will surpass Tata Consultancy Services' ₹4,700 crore IPO from a long time ago, becoming the largest public issue in India's IT services sector. The listing will not only increase Hexaware's visibility and brand recognition, but also offer liquidity to its current shareholders. Moreover, it would allow the company to access the capital markets for future expansion and projects.
Financial Performance
Financials (in ₹ Cr) | FY21 | FY22 | FY23 |
Revenue | 7,177 | 9,199 | 10,380 |
PAT | 748 | 884 | 997 |
EPS(₹) | 24 | 29 | 32 |
Hexaware Technologies performance in Unlisted Market
Prior to its IPO, there has been a high level of interest in privately held shares of Hexaware Technologies. In the unlisted marketplace, Hexaware Technologies' share price is ₹1,055 per share, representing a ₹2 face value per share. Investors are anxiously awaiting the IPO and carefully watching the shares' performance in the public market, paying attention to the company's robust financials and competitive position.
Investor Considerations towards this IPO Move
Investors have to don't forget several factors before investing in Hexaware IPO:
Strong Financial Performance: Hexaware has proven consistent sales and earnings boom, that's a positive indicator for potential investors.
Market Position: The company has a robust presence inside the IT services sector, serving several Fortune 500 companies.
Growth Potential: Hexaware is well-positioned to capitalize on the growing demand for these offerings, with a focus on AI and virtual transformation.
Valuation: Hexaware's predicted valuation tiers are between ₹40,000 crore to ₹50,000 crore, with a predicted step with percent value of ₹1,300 to ₹1,600.
Associated Risks: Investors needs to be aware about potential risks, alongside marketplace volatility, opposition, and regulatory changes that might impact the business enterprise's overall performance.
Risks & Concerns
Economic Dependence: Hexaware derives a huge part of its sales from the Americas and Europe. Any negative monetary situations in these regions could negatively affect the enterprise's financial overall performance.
Sectoral Risks: The organization’s heavy reliance on the Financial Services and Healthcare and Insurance sectors means that any downturn in the ones industries may have an impact on its revenue streams.
Competitive Landscape: Hexaware operates in an exceptionally competitive marketplace, dealing with pressure from worldwide and neighborhood players. Larger companies with availability of superior resources can provide better pricing and incentives, posing a threat to Hexaware's market share.
Insourcing Trend: A growing interest amongst clients to insource IT services to preserve, manipulate and decrease costs could pose a threat to Hexaware's outsourcing business version.
Conclusion
The ₹9,950 crore IPO of Hexaware Technologies is a landmark occasion within the Indian IT region. With its robust economic performance, strategic consciousness on AI, and backing from the Carlyle Group, Hexaware is properly-positioned to draw considerable investor interest. The hit listing of Hexaware will not most effectively provide liquidity to its present shareholders but also set a precedent for different IT corporations thinking about going public.