The initial public offering of global market intelligence provider Tracxn Technologies has seen a muted response, with the IPO subscribed 2.01 times by the afternoon of October 12, the final day of bidding.
Investors have, so far, bought 4.27 crore equity shares against 2.12 crore shares on offer, data available with exchanges show.
The portion set aside for retail investors was fully booked on the first day itself and has been bought 4.87 times the allotted size, while the part set aside for non-institutional investors has been subscribed 80 percent.
Qualified institutional investors have bought 1.66 times or 1.92 crore shares allotted to them.
Tracxn is planning to mobilise Rs 309 crore through the issue which is an offer for sale. The price band has been fixed at Rs 75-80 a share.
Filpkart founders Binny Bansal and Sachin Bansal will be exiting the company by selling their entire stake, while promoters Neha Singh, Abhishek Goyal and other investors, too, are participating in the OFS.
The company ranks among the top five players globally in terms of the number of companies profiled offering data of private market companies across sectors and geographies, the draft papers for the IPO said. It has witnessed strong growth in its top line in the previous three years due to the technology & startup boom during the pandemic and robust M&A activities.
But, the company faces significant competition from private players such as Crunchbase, CBInsights, PrivCo & Pitchbook, and free online and offline sources of information on companies and businesses, including government records, company websites, and open online databases, Swastika Investmart said.
The brokerage said due to the rising interest rates globally an recessionary conditions in major markets like North America and Europe, private equity markets, venture capital markets, investment banks and family offices are witnessing a significant cutback in terms of activities and traction. Mergers and acquisitions, activities, too, have been subdued.
Tracxn would find it difficult to substantially grow its client base and top line in the coming years, it said. Finally, "the exorbitant valuation of price to sales of ~12.5 (based on FY22 numbers and upper band price) makes it very difficult to recommend this issue. Thus we have assigned avoid rating for this issue," the research firm said.
Tracxn Technologies had a base of 1,139 customer accounts in over 58 countries as of June 2022, which increased at a CAGR of 30.42 percent from 642 customer accounts in March 2020, backed by its marketing efforts and referrals by existing customers, the company said.
It recorded a profit of Rs 83.59 lakh for the quarter ended June FY23 against a loss of Rs 72.02 lakh in the corresponding period last fiscal and revenue from operations grew by 23 percent to Rs 18.4 crore during the same period.
In FY22, it reported a loss of Rs 4.84 crore against a loss of Rs 5.34 crore in the previous year, while revenue increased by 45 percent to Rs 63.45 crore.
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