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Netweb Technologies, a high-end computing solutions provider, kicked off its initial public offering (IPO) on July 17, with a total value of Rs 631 crore. The IPO is scheduled to close on July 19. Prior to the IPO, the company’s shares were trading at a premium of Rs 380 in the unlisted market, offering investors a glimpse of the potential listing price.
Anand Rathi, in a research report, praised Netweb Technologies as one of India’s premier homegrown high-computing solutions (HCS) providers, boasting integrated design and manufacturing capabilities, along with a diverse and esteemed customer base.
With a price-earnings (P/E) ratio of 60 times FY23 earnings, the company is valued at a market capitalization of Rs 28,010 million post-issue of equity shares, with an impressive return on net worth of 68.01 percent.
Analysts from Anand Rathi have bestowed a ‘Subscription’ rating for long-term investors, deeming the IPO as reasonably priced. Netweb Technologies is offering shares at a price range of Rs 475-500 for the offering. Investors can bid for a minimum of 30 shares and in multiples thereafter.
The IPO comprises a fresh issue of equity shares up to Rs 206 crore and an offer-for-sale (OFS) of up to 8.5 million equity shares by promoter selling shareholders. Sanjay Lodha will offload 2.8 million shares, while Navin Lodha, Niraj Lodha, and Vivek Lodha will each sell 1.43 million shares.
Qualified Institutional Buyers (QIB) are allocated 50 percent of the net offer, with non-institutional bidders (NII) receiving 15 percent, and the remaining 35 percent allocated to retail investors.
Prior to the IPO launch, the company secured Rs 189 crore from anchor investors, receiving strong support from prominent names such as Nomura Funds, Goldman Sachs Funds, ICICI Prudential MF and Life Insurance, HDFC MF, WhiteOak MF, among others.
For the fiscal year ending March 2022, Netweb Technologies recorded revenues of Rs 445 crore, with a profit of Rs 46.9 crore during the same period.
The funds raised through the IPO will be utilized for capital expenditure, long-term working capital, and the full or partial repayment of debt.