Mumbai-based e-governance solutions company Protean eGov Technologies is likely to start the first day first trade with around 10 percent gains on November 13, experts said. They attributed the expected decent listing to its healthy subscription numbers, leading position in the e-governance sector, experienced senior management, and sustainability of earnings growth in the past financial years.
The Rs 490-crore public issue was subscribed 23.86 times during November 6-8, with major support from qualified institutional buyers and high networth individuals who bought 46.94 times and 31.62 times the allotted quota. Retail investors bid 8.93 times the portion set aside for them.
At the upper end of the price band of Rs 752-792 per share, it is valued at a PE (price-to-earnings ratio) of 29.9 times its FY23 numbers and the market capitalisation is Rs 3,203 crore.
"With Protean eGov Technologies IPO receiving a healthy subscription, we expect the IPO to list at an 8-10 percent premium to the issue price of Rs 792 per share," Dhruv Mudaraddi, research analyst at StoxBox said, adding Protean is a pioneer in the e-governance sector in terms of profitability, operating income, and operating profit in FY23.
Also read: Primary market to cool off with just 1 IPO and 3 listings next week
It is a professionally managed company led by an experienced senior management team whose expertise and industry experience have helped it grow operations and innovate services. The company has a track record of sustained revenue and PAT growth, growing at a CAGR of 10.9 percent and 7.8 percent during the FY21-23 period.
Further, "building capability around data analytics, healthy financial performance, diversifying offerings with a focus on new sectors, and expanding into more contemporary geographies are key growth drivers for the IT company's performance in the long term," he said.
The IT-enabled solutions company works with the government and has gained extensive experience creating digital public infrastructure and developing innovative citizen-centric e-governance solutions.
Since its inception and as of June 30, 2023, the citizen-centric and population-scale e-governance solutions company has developed and implemented 19 projects across seven ministries across India. Its market share has been 45 percent in PAN issuance, 58 percent in Tax Information Network, 94 percent in National Pension System and 100 percent in Atal Pension Yojana (APY).
Considering the healthy subscription demand and optimistic market mood, Prashanth Tapse, research analyst, senior VP research at Mehta Equities also feels a decent 10 percent listing gain can be assumed against the issue price.
"We like Protean’s unique business model with a niche product portfolio focusing on eGovernance business. While upside looks limited based on valuation parse as the issue was fully priced in discounting all near term triggers," he said.
Also read: ASK Automotive IPO | Check grey market premium; listing & allotment dates
The public issue was comprised only of an offer-for-sale by investors including HDFC Bank, Axis Bank, Union Bank of India, NSE Investments and 360 One Special Opportunities Fund. Hence, all the money will go to selling shareholders and the company will not receive any money from the offer.
Disclaimer: The views and investment tips expressed by investment 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.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
Find the best of Al News in one place, specially curated for you every weekend.
Stay on top of the latest tech trends and biggest startup news.
