The initial public offering (IPO) of computing solutions provider Net Web Technologies India opens for public subscription on July 17. The IPO will remain open for a 3-day subscription and close on July 19.
Net Web Technologies IPO consists of a fresh issue of shares worth ₹206 crores and an offer-for-sale of up to 85 lakh shares by its existing promoters and shareholders.
The company has set the price band for the public issue at ₹475-500 per share. At the upper band price, the company expects to raise ₹631 crore through the IPO.
Post the public offer; Net Web Technologies shares will be listed on the stock exchanges BSE and NSE on July 27. Net Web Technologies IPO allotment is expected to be on July 24.
The lot size for the Net Web Technologies IPO is 30 shares, and retail investors can apply up to 13 lots.
Net web Technologies IPO: Price band fixed at ₹475-500 per share;
Net Web Technologies India Ltd. specializes in High-end Computing
Solutions (HCS) serves various sectors, including IT, IT-enabled services, entertainment, media, BFSI, national data centers, and government entities.
The company operates a manufacturing facility in Faridabad, Haryana, with 16 offices across India. NTIL's three supercomputers have been listed among the world's top 500 supercomputers 11 times.
The company has raised ₹51 crores from pre-IPO placement at an issue price of ₹500 per share from marquee institutional investors, including LG Family Trust and Anupama Kishore Patil.
In FY23, the company's revenue rose by 80% YoY to ₹445 crore, compared to ₹247 crore in the previous year. Its net profit doubled to ₹47 crore during the same period from ₹22.5 crore. EBITDA margins expanded to 15.7% in FY23 from 10.1% in FY21.
Net Web Technologies IPO GMP Today
Net Web Technologies IPO GMP today, or grey market premium today, is ₹365 per share, as per market observers. This means the shares of Net Web Technologies are trading at a premium of ₹365 a piece in the unlisted market. Considering the IPO price and the GMP today, Netweb Technologies shares are expected to be listed at ₹865 apiece on the exchanges, which is at a premium of 73%.
Net Web Technologies IPO - Should you subscribe?
Most analysts have assigned a 'Subscribe' rating to the Net Web Technologies IPO, given its business potential, earnings growth, and reasonable valuations.
At the upper price band of ₹500, Net Web Technologies is available at a P/E of 59.7x (FY23), which appears reasonably priced compared to peers, Geoje Financial Services said.
"With effective management, consistent growth, an expanding product portfolio, geographic footprints, and Digital India initiative by the Government, Net Web Technologies is well-positioned to capitalize on the Indian IT industry's growth. Therefore, we assign a "Subscribe" rating for the issue on a short to medium-term basis," it added.
Choice Broking
Choice Broking expects the company’s top line over FY23-25 is likely to grow by 37% CAGR to ₹835.4 crore in FY25. Economies of scale operation would expand the EBITDA and PAT margin by 132 bps and 162 bps, respectively, to 17.1% and 12.2% in FY25E.
“No comparable peers in the listed space have a business model and product offerings similar to Net web Technologies. At the higher price band, it demands a P/E multiple of 59.7x (to its FY23 earning), which seems to be higher. However, considering the business potential and earnings growth in the medium term, we believe the demanded valuation is reasonable," said Choice Broking.
Thus, it assigned a “Subscribe" rating for the issue.
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