Ciel HR Services plans to tap primary market, files for IPO with Rs 335 cr fresh issue size

Ciel HR Services IPO

Recruitment and staffing services provider Ciel HR Services plans to tap the primary market for raising funds via an initial share sale, and has filed preliminary papers with the capital markets regulator SEBI on November 19.

The IPO is a combination of fresh issuance of equity shares worth Rs 335 crore, and an offer-for-sale of 47.39 lakh shares by the existing shareholders including promoters, as per the draft red herring prospectus.

Ciel HR Services offers technology-driven human resources solutions across the entire human resource chain. The HR solutions industry's average CAGR was approximately 18.1 percent between FY21 and FY24.

Having asset-light model business model and low capital expenditure requirements, the company had acquired three companies - Next Leap Career Solutions (Jombay), Aargee Staffing Services, and Firstventure Corporation (Courseplay) - since fiscal 2022. Further, it also acquired 51 percent shareholding each in People Metrics, and Thomas Assessments in October 2024, making them its own subsidiaries.

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Promoters including Aditya Narayan Mishra (Managing Director and CEO), Santhosh Kumar Nair (Executive Director and COO) and Doraiswamy Rajiv Krishnan (Executive Director) hold 87.02 percent stake in the company, while the public shareholding stands at 11.04 percent.

The company intends to spend Rs 40.7 crore out of the net fresh issue proceeds for acquisition of additional shareholding in its subsidiaries, and invest Rs 55.2 crore in subsidiaries. Furthermore, Rs 100 crore will be utilised for working capital requirements, and the remaining funds for inorganic acquisitions and general corporate purposes.

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The listed competitors for the Bengaluru-based human resources solutions company are Quess Corp, TeamLease Services, and Spectrum Talent Management. On the financials front, it reported consolidated profit at Rs 10.85 crore for fiscal 2024, against Rs 3.2-crore loss in the previous year, while revenue from operations during the same period increased sharply by 35.8 percent to Rs 1,085.7 crore, up from Rs 800 crore. Profit in the June 2024 quarter came in at Rs 3.2 crore on revenue of Rs 325.2 crore.

The merchant bankers appointed for handling the issue are Ambit, Centrum Capital, and HDFC Bank.