The initial public offering (IPO) of Tracxn Technologies (TTL) continued to be on the sidelines, struggling to get response from the investors. It was subscribed only 54 per cent by the end of the second day.

The issue kicked off for subscription on Monday, October 10 and will close for subscription on Wednesday, October 12. The company is selling its shares in the range of Rs 75-80 apiece to raise about Rs 310 crore via its initial stake sale.

According to the data from BSEthe investors made bids for 3,42,24,075 equity shares or 1.61 times compared to the 2,12,69,714 equity shares offered for the subscription by 2 pm on Wednesday, October 12.

The quota for retail bidders was subscribed 3.77 times, whereas the allocation for HNI investors fetched only 65 per cent bids. The quota for qualified institutional investors was subscribed 1.37 times.

The company will not receive any proceeds from the issue and the entire sum will go to the selling shareholders. The company said that it intends to gain the benefits of listing the shares on the stock exchanges.

Founded in 2013, Tracxn Technologies provides market intelligence data for private companies. The company has an asset light business model and operates a Software as a Service (SaaS) based platform named Tracxn.

Brokerage firms remain negative on the issue, suggesting to avoid it, citing concerns like net loss, stiff competition, rich valuations and pure OFS by the company. However, a few analysts have suggested subscribing to it for a long term basis.

Tracxn Technologies is one of the leading global providers of differentiated private market data and intelligence in a highly competitive industry but it reported negative EBITDA in the previous three financial years, said

citing avoid rating to the issue.

Another brokerage firm

said that the company will find it difficult to substantially grow its client base and top line in the coming years. “The exorbitant valuation of price to sales of about 12.5x, which makes it very difficult to recommend,” it said with an avoid call for the issue.

For the fiscal year 2021, the company clocked a total revenue of Rs 55.74 crore, which was Rs 63.13 crore a year ago. The company reported a net loss of Rs 5.35 crore, which was significantly lower than a net loss of Rs 54.03 crore last year.

Tracxn Technologies said it has raised Rs 139.22 crore from anchor investors including various funds and financial institutions have subscribed for 1.74 crore equity shares at a price of Rs 80 per share, the company said in a BSE circular.

However,

said that the company is a leading global player, ranking amongst the top 5 in its segment. With cost arbitrage advantages, high operating leverage, a strong technology platform, and comprehensive data coverage.

“It has achieved breakeven and reported gains in Q1FY23. The stock is currently valued at P/S of 12.7x to its FY22 sales of Rs 63.43 crore, the issue is fairly priced and we recommend that investors subscribe for long term,” it added .

is the sole book running lead manager to the issue, whereas Link Intime India has been appointed as the registrar for the issue. Shares of the company will be listed at both BSE and NSE.

Brokerage firms are mixed over the issue. A few have suggested avoiding the issue citing net loss, pricey valuations and pure OFS by the company. However, a few analysts have suggested a bid for the issue citing growth prospects for it.

(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of Economic Times)

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By Dipak

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