MapmyIndia IPO: MapmyIndia IPO Launch: Here’s Why Brokers Are Bullish On It

New Delhi: The initial public offering (IPO) of Rs 1,039.61 crore from CE Info Systems (MapmyIndia) was launched for underwriting on Thursday, December 9.

The issue consists of an offer to sell (OFS) of 10,063,945 shares, with a nominal value of Rs 2 each by the existing shareholders and the promoters of the company.

Among the promoters, Rashmi Verma will sell 42 51 044 shares, while other shareholders such as Qualcomm Asia Pacific Pte will sell 27 01 407 shares and Zenrin Co Ltd will sell 13 69 961 shares through OFS.

The company has set the price range for the sale of the shares at Rs 1,000-1,033 each and investors can bid on a minimum of 14 shares and then in multiples thereof.

The majority of brokerage firms have suggested investors buy into the issue, due to its high growth potential, conservative valuations, strong customer base, and barrier to entry to the business.

Founded in 1992, MapmyIndia is a leading provider of advanced digital maps, geospatial software and location-based IoT technologies in India.

While mainstream apps like Google Maps are free, APIs and enterprise solutions are paid services and the company has an advantage because of its more accurate maps over its peers, Reliance Capital said in its report. IPO note.

“The company aims to develop and innovate its technological capabilities, with a larger stack of software products,” the brokerage firm said while giving a subscription rating on the long-term problem due to its growth potential. high, increasing the use of new technologies. platforms by customers, minimal competition and ease of evaluation.

Meanwhile, Arihant Capital, which has a subscription rating on the issue, said that at the upper price bracket level, the issue is valued at a P / E multiple of 94x based on FY21 EPS. . The company has strong fundamentals and its profitability is expected to increase further, he added.

“It is the market leader in the digital map and geospatial software industry, effectively creating a barrier to entry against potential competition. His long-standing relationships with high-value customers not only generate repeat sales, but also encourage cross-selling and upselling. It said.

MapmyIndia has certain advantages as its digital maps and other solutions are localized for difficult Indian geography and are extensive in terms of coverage.

Marwadi Shares and Finance said that considering TTM-adjusted EPS of Rs 16.30 on post-issue basis, the company will register at a P / E of 63.37 with a market cap of Rs 5,500 crore .

“There is no listed company in India whose activity is comparable to that of the company. It is available at a reasonable valuation given the potential for future growth,” he added. The brokerage has a subscription rating on the item.

The company is one of the leading data and technology product and platform companies having a well-known brand with customers such as PhonePe, Flipkart, Yulu, HDFC Bank, Airtel, Hyundai, MG Motor, Safexpress and others.

There is the possibility of additional upselling or cross-selling as the maps and platform are constantly updated with validated feedback that can create a network effect, Angel One noted.

“Considering the company’s leading position in India, customer base and network effect benefits, healthy margins and return profile as well as strong cash conversion, we recommend subscribing to the ‘show in a long-term perspective, “he said.

In fiscal year 2020-21, the company’s net profit more than doubled to Rs 59.43 crore from Rs 23.19 crore in the previous fiscal year. Income increased from Rs 192.27 crore to Rs 163.48 crore during the given period.

The company reported net profit and revenue of Rs 46.76 crore and Rs 122.58 crore, respectively, for the period ended September 30, 2021.

“MapmyIndia is a leader in digital mapping in India and has a forerunner advantage. The company has shown stable revenue and earnings growth, ”said Swastika Investmart, with a subscription rating on IPO for listing and long-term gains.

“We believe that new cutting-edge technologies, including providers of SaaS, PaaS and MaaS platforms, have a promising future for the next few years,” he added. “The company serves a variety of industries and sectors, which is also positive.”

Brokerages suggest that the increasing use of mobile navigation devices, 3D platforms, and advanced survey technology, digital mapping will help drive growth in the years to come.

In its pre-IPO memo, Religare Broking said the company’s growth would come from new plans and policies announced by the government that encourage domestic players to digital maps and associated solutions.

“The company will benefit from the growth of the industry as it operates under a lean business model with low variable costs and high barriers to entry into the segment,” he added. with a positive outlook on the long term issue.

50 percent of the net issuance is reserved for Qualified Institutional Buyers (QIB), while non-institutional buyers will be allocated 15 percent of the shares. The retail portion has been set at 35 percent of the supply.

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