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OnMobile Global, a leading provider of telecommunications value added software products and services in India with an expanding international presence, has opened for subscription with an initial public offering of 10,900,545 equity shares of Rs 10 each for cash at a price to determined through a book building process.

The issue will close for subscription on January 29, 2008. The price band has been fixed between Rs 425 and Rs 450 per equity share.

Moneycontrol conducted a poll on market experts to check whether to apply for the public issue or not. Majority of experts said apply.

Experts/Company	Poll Result	Experts view
R S Iyer (KR Choksey)	Apply	OnMobile Global is a good issue. People should subscribe to the issue at Rs 450, a higher end of price band.
Manish Bhatt (Prabhudas Lilladher)	Apply	Onmobile is a good pick. Investors should apply for the issue. It is currently available at PE of 28.7 on FY09 EPS. It has strong relationship with clients like Reliance Communications, Bharti Airtel, Idea Cellular and Vodafone. It also has clients in other eight countries like Bangladesh, Australia etc.   Its EBIT margin in 2005 was 64.60%, that reduced to 45.90% in FY07. Expected EBIT margin for FY08 will be 41.50%. Topline CAGR for last three years is around 82.70% and FY07 topline around Rs 1.4 billion. EBIT margin for FY10 is expected to be 39% and Profit margin at 25%. ROCE and RONW for FY07 were around 30.7% and 33.5%.   People should apply for the stock with medium to long term perspective.
SP Tulsian (Investment Advisor)	Don't Apply	Onmobile Global provides music related services like ringback tones, ringtone downloads and music messaging applications by sourcing it from music label companies and provides them to telecom service providers like Bharati Airtel, Idea Cellular, Reliance Infocom and Vodafone on revenue sharing basis.   For FY 07 total income was placed at Rs.141 crore with PAT of Rs 34.95 crore, resulting into an EPS of Rs 7.16. FY 08 may have a topline of Rs 250 crore with PAT of about Rs 65 crore, resulting into an EPS on expanded equity of Rs 57.40 crore at Rs 11.30. This implies share issue at the upper band of Rs 450 at a multiple of about 40 times. Grossly overprices.   The business model of the company is largely dependent on both the sides for procurement and supply margin pressure also exists on both the sides and as time goes by, this would only deepen further.   Tanla Solutions, with an expected EPS of close to Rs 30 for FY 08 in ruling below Rs 700 implying a multiple of less than 24 times. Also, the business segment in which the company is operating is getting crowded with margins shrinking. In this situation, it is a clear advice to remain away from the issue as it is just not worth it at the offer price.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The company is proposing a fresh issue of 8,613,356 equity shares and an offer for sale of 2,287,189 equity shares by Onmobile Systems Inc. The issue would constitute 18.99% of the fully diluted post issue paid-up capital of the company.

At least 60% of the issue will be allocated on a proportionate basis to qualified institutional buyers, out of which 5% shall be available for allocation on a proportionate basis to mutual funds only. Further, not less than 10% of the issue will be available for allocation on a proportionate basis to non-institutional bidders and not less than 30% of the issue will be available for allocation on a proportionate basis to retail individual bidders.

The objects of the issue are to purchase equipment for the company's offices at Bangalore, Mumbai and Delhi and various customer sites, to meet working capital requirements, repayment of loan and to fund expenditures for general corporate purposes.

The equity shares are proposed to be listed on Bombay Stock Exchange and National Stock Exchange of India.

The book running lead managers to the issue are Deutsche Equities India Private Limited and ICICI Securities Limited.

It has a broad range of applications that are delivered by its carrier customers to their end-user subscribers. These products include ringback tones, voice portals, ringtone downloads, subscription manager, contests, music messaging, on-device client software, mobile radio, dynamic voicemail, voice short messaging service and missed call alerts which enable subscribers to personalise their mobile phones and thereby enhance user experience.