The initial public offering (IPO) of Veranda Learning Solutions had been subscribed 1.31 times, garnering bids for 1.54 crore equity shares against an offer size of 1.17 crore equity shares, by the morning of March 30, the second day of bidding.
Retail investors who bid 7 times their allotted quota continued to show interest in the public issue. The portion set aside for non-institutional investors has been subscribed 106 percent and that of qualified institutional buyers 28 percent.
The IPO will fetch the company Rs 200 crore, which will be utilised for repaying of debts, payment of acquisition cost of Edureka, and growth initiatives.
The price band for the offer, which closes on March 31, is Rs 130-137 a share.
Veranda Learning Solutions provides learning solutions in online, offline hybrid and offline blended formats to students, professionals and corporate employees through career-defining competitive exams, professional courses, exam-oriented courses, short-term upskilling and reskilling courses.
"The company is bringing the issue at price-to-book multiple of 8.15x on pre-issue book value basis. Although the company's business model is technology-driven, asset-light and scalable with a proven track record of promoters along with a result-oriented method of teaching with a 360-degree approach and diversified course offerings and delivery channels but looking at the financials of the company and valuations, we recommend “avoid” on the issue," said Astha Jain, Senior Research Analyst at Hem Securities.
In the financial year ended March 2021, Veranda posted a loss of Rs 8.3 crore on a revenue of Rs 2.54 crore, and in the six months period ended September 2021, the loss was at Rs 18.3 crore on increased revenue of Rs 15.46 crore.
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Veranda Learning Solutions provides diversified and integrated learning solutions in online, offline hybrid and offline blended formats to students, professionals and corporate employees through career-defining competitive exams, professional courses, exam-oriented courses, short-term upskilling and reskilling courses.Disclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.