Should You Buy On Day 2 of the eMudhra IPO Given the GMP, Subscription Status, Financials, and Revie
Day 2 of the eMudhra IPO subscription period begins on Monday, May 23, 2022, and lasts through Wednesday, May 24, 2022. The company, which is the biggest licensed certified authority (CA) in the Indian market for digital signature certificates, plans to raise about Rs 413 crore through a fresh issue of equity shares worth up to Rs 161 crore and a sale offer by the shareholders and promoters of 9,835,394 equity shares worth up to Rs 252 crore.
Enterprise solutions including individual/organizational certificates, digital signature certificates, etc. are provided by the company as part of its operations. eMudhra announced that it has secured Rs 124 crore from anchor investors ahead of its initial public offering one day before the offer was made to the general public. Among the investors who took part in the anchor book were Motilal Oswal MF, Nippon India MF, SBI MF, Baring Private Equity India, Hornbill Orchid India Fund, and Pinebridge India Equity Fund, and Abakkus Growth Fund.
eMudhra IPO: Subscription Status
By the conclusion of day one on Friday, 0.48 times had subscribed to eMudhra. The price range for the IPO has been set at Rs. 243-256 per share, with 58 shares constituting one lot. Only retail investors showed interest, as seen by the 0.94 times subscription of the amount reserved for them. While the non-institutional investor quota only received 0.04 times or 4%, QIBs has not yet submitted a bid.
The Issue's book running lead managers are IIFL Securities Limited, Yes Securities (India) Limited, and Indorient Financial Services Limited, and its registrar is Link Intime India Private Limited.
eMudhra IPO: GMP Today
Shares of the eMudhra IPO are not currently trading on the black market. The grey market premium (GMP) for the eMudhra IPO was negative Rs 5 on Friday. The price range for the offered shares has been set by the firm at Rs. 243 to 256 per share. Therefore, eMudhra shares are trading for Rs 251 on the black market at the top end of the price range.
eMudhra IPO: Financials
In addition to exceeding prior figures in the first nine months of the FY22, the company's revenue and profit after tax (PAT) have been rising over the past three fiscal years. The overall income of the company was Rs 101.6 crore in FY19; this increased to Rs 116.8 crore in FY20 and to Rs 132.4 crore in FY21. Its entire income over the first nine months of FY22 is Rs 138.3 crore.
Similar to this, eMudhra Limited recorded PAT of Rs 17.4 crore in FY19, Rs 18.4 crore in FY20, and Rs 25.3 crore in FY21. PAT of Rs 30.3 crore was recorded by eMudhra Limited for the first nine months of FY22. As a result, the company's finances have been stable for the past four fiscal years.
eMudhra IPO: Objective
The revenues from the eMudhra IPO will be used to pay off all or part of the borrowings, meet working capital needs, buy equipment, and cover other associated expenditures for data centers that are planned to be built in India and other countries.
eMudhra IPO: Should You Subscribe?
Regarding the current topic, Angel One is unbiased. Angel According to a research report on the eMudhra IPO: "eMudhra has a well-established position as a licensed CA with a strong network of channel partners, a diverse customer base, and it will be using a portion of the IPO proceeds to grow overseas markets as well as improve its data center infrastructure. The market for digital security and paperless transformation is extremely competitive, despite the operation's modest size. The post-issue FY22 annualized P/E comes out at 49.0x at the upper end of the price range, which we feel factors in the positives. Therefore, we advise giving the issue a Neutral rating.