Friday, Aug 19, 2022

MapMyIndia IPO Opens Today, Raises Rs 312 Crore Funding. Should You Subscribe?

MapMyIndia IPO is entirely an offer for sale (OFS) of up to 10,063,945 equity shares by existing shareholders and promoters. It has allotted 30.19 lakh equity shares to 24 anchor investors at Rs 1,033 apiece.

Digital mapping company MapMyIndia, which powers Apple maps, on Wednesday said it has mobilised Rs 312 crore from anchor investors ahead of its initial share sale that opens for public subscription on Thursday.      

The company has allotted 30.19 lakh equity shares to 24 anchor investors at Rs 1,033 apiece, taking the transaction size to Rs 312 crore, according to a circular uploaded on the BSE website.     

Fidelity, Nomura, Goldman Sachs, Morgan Stanley, Aberdeen and HSBC were allocated equity shares by MapmyIndia into the anchor book.       

In addition, leading domestic mutual funds SBI Mutual Fund (MF), HDFC MF, ICICI Prudential MF, Aditya Birla Sun Life MF,  Tata MF and Sundaram MF, as well as life insurance companies such as HDFC Life Insurance Company and Tata AIA Life Insurance Company participated in the anchor book.      

The IPO is entirely an offer for sale (OFS) of up to 10,063,945 equity shares by existing shareholders and promoters.        

Half of the issue size has been reserved for qualified institutional buyers (QIBs), 15 per cent for non-institutional investors and 35 per cent for the retail investors.      

 Investors can bid for a minimum of 14 equity shares and in multiples thereof.          

Axis Capital, JM Financial, Kotak Mahindra Capital and DAM Capital Advisors are the lead managers to the issue. PTI SP  ABM

The OFS comprises sale of up to 42.51 lakh equity shares by Rashmi Verma, up to 27.01 lakh equity shares by Qualcomm Asia Pacific Pte Ltd and up to 13.7 lakh equity shares by Zenrin Co Ltd. The remaining 17.41 lakh equity shares will be offloaded by several other shareholders.       

At present, promoters -- Rakesh Kumar Verma and Rashmi Varma -- hold 28.65 per cent and 35.88 per cent stake in the company.      

The issue, with a price band of Rs 1,000-1,033 a share, will open on December 9 and close on December 13.     

The public issue is expected to fetch Rs 1,039.6 crore at the upper end of the price band.      

C.E. Info Systems Ltd,  popularly known through its brand MapmyIndia, is backed by global wireless technologies company Qualcomm and Japanese digital mapping Zenrin.      

The New Delhi-based company is a leading provider of advanced digital maps, geospatial software and location-based IoT technologies.         

Check what analysts/brokerage houses are saying, according to Zee Business.

Ravi Singhal, Vice Chairman at GCL Securities

The analyst has given a subscription call to the issye, saying MapmyIndia offers a great business model with entry barriers.

It is generally a good promoters' pedigree. The fundamentals are good as it is an almost zero debt company. B2B business looks great. Also, good growth potentials look promising. However, the concerns remain that any technology updation or change in the existing setup can affect the business, he said, adding, valuation is on the higher side but growth prospect is also high.

Angel One

MapmyIndia being a pioneer, has certain advantages as its digital maps and other solutions are localised for the challenging Indian Geography and are extensive in terms of coverage. There is the scope of further up selling or cross selling while the maps and platform are constantly updated with validated feedbacks, which can create the network effect, as per a report published in Business Insider.

“Considering the company’s leadership position in India, client base and benefits of network effect, healthy margins and return profile as well strong cash conversion, we recommend subscribe on the issue from a long-term perspective,”the brokerage firm added.

Manoj Dalmia, Founder and Director-Proficient Equities Limited

Qualcomm will exit its entire 5 er cent stake, Zenrin will sell around 3 per cent stake of the holdings, while Phone Pe will have around 18 per cent stake. One may subscribe for listing gains considering MaymyIndia’s GMP and client base.

Marwadi Shares and Finance Limited

The brokerage house has also given a call to the issue. There are no listed companies in India whose business is comparable with that of the company’s business. It is one of the leading data and technology products and platform companies having a well-known brand MapmyIndia with customers like PhonePe, Hyundai and Flipkart. Also, it is available at a reasonable valuation considering the future growth potential.

(With inputs from Outlook Business Bureau)