Software product developer E-Zest Solutions is planning to tap capital market with its public issue of 1 crore equity shares for expansion, by diluting 40.83% stake.
Software product developer E-Zest Solutions is planning to tap the capital market with its public issue of 1 crore equity shares for expansion, by diluting 40.83% stake. The company has filed draft red herring prospectus with SEBI.
E-Zest is a global software product engineering and enterprise application development company having expertise in emerging technologies such as cloud computing/SaaS, business intelligence and mobility.
It intends to use IPO funds for setting up of software development centre (with an outlay of Rs 23.75 crore); product/IP development (with cost of Rs 7.66 crore); setting up of an overseas sales and delivery offices (with Rs 3.03 crore); acquisition of domestic company (with an outlay of Rs 2 crore); and up-gradation of existing IT infrastructure (at cost of Rs 1.76 crore).
The company reported a net profit after tax of Rs 2.35 crore on total income of 22.13 crore in the year ended March 31, 2011, a growth of 143% and fall of 15.7%, respectively.
Income of the company has become taxable with effect from Assessment Year 2012-13 as a result of withdrawal of tax exemption under Section 10 A of Income Tax Act, 1961.
Majority of revenues of the company are derived from clients located in the European Union and United States, 31% and 24% in the year ended March 31, 2011, respectively. However, 16.7% of revenue is generated from domestic clients.
Choice Capital Advisors Private Limited is the book running lead manager to the issue.