Upcoming IPO: Carlyle-promoted Hexaware Technologies IPO sets price band at ₹674-708 apiece; check issue details, more

Upcoming IPO: Hexaware Technologies IPO price band: The Hexaware Technologies Limited IPO price band has been fixed in the range of ₹674 to ₹708 per equity share of the face value of Re 1. The Hexaware Technologies IPO date of subscription is scheduled for Wednesday, February 12 and will close on Friday, February 14. The allocation to anchor investors for the Hexaware Technologies IPO is scheduled to take place on Tuesday, February 11.

The floor price and the cap price are 674 times and 708 times the face value of the equity shares. The price-to-earnings ratio based on basic EPS for the fiscal 2023 for the company at the higher end of the price band is 43 times and at the lower end is 41 times. The Hexaware Technologies IPO lot size is 21 equity shares and in multiples of 21 equity shares thereafter.

Hexaware Technologies IPO has reserved not more than 50% of the shares in the public issue for qualified institutional buyers (QIB), not less than 15% for non-institutional Institutional Investors (NII), and not less than 35% of the offer is reserved for retail investors. A discount of ₹67 apiece is being offered to eligible employees bidding in the employee reservation portion, and equity shares aggregating up to ₹900 million is reserved for employees.

Tentatively, Hexaware Technologies IPO basis of allotment of shares will be finalised on Monday, February 17 and the company will initiate refunds on Tuesday, February 18 while the shares will be credited to the demat account of allottees on the same day following refund. Hexaware Technologies share price is likely to be listed on BSE and NSE on Wednesday, February 19.

US private equity firm Carlyle promoted Hexaware Technologies, a global company focused on digital and technology services with artificial intelligence (AI) at its foundation. The company utilises technology to provide innovative solutions that assist their clients in navigating digital transformation and effectively managing their business operations through six segments based on the industries they cater to: Financial Services, Healthcare and Insurance, Manufacturing and Consumer, Hi-Tech and Professional Services, Banking, and Travel and Transportation.

Their services consist of five main categories: Design & Build, Secure & Run, Data & AI, Optimize, and Cloud Services, which serve as the basis for their offerings.

For the financial year 2023, the company's operational revenue reached ₹103,803 million (US$1,256.4 million), reflecting a compound annual growth rate (CAGR) of 13.7% in USD terms, up from ₹71,777 million (US$971.2 million) in financial year 2021. Meanwhile, the Everest Report indicates that the global outsourced IT-BP services sector experienced a CAGR of 7.3% in the same timeframe.

As per the red herring prospectus (RHP), the company's listed peers are Persistent Systems Ltd (with a P/E of 84x), Coforge Ltd (with a P/E of 64x), LTIMindtree Ltd (with a P/E 38x), and Mphasis Ltd (with a P/E of 34x).

Hexaware Technologies IPO details

The Hexaware Technologies IPO consists entirely of an offer-for-sale (OFS) of shares valued at ₹8,750 crore by promoter CA Magnum Holdings, part of the Carlyle Group Inc, a global multinational corporation based in the United States. The size of the OFS has been decreased from the ₹9,950 crore stated earlier in the draft documents submitted on September 6, 2024.

As a result, all proceeds from the IPO (excluding expenses related to the offer) will be received by promoter CA Magnum Holdings, which is the selling stakeholder. CA Magnum possesses a 95.03 percent ownership stake in the company, while the remaining shares are owned by the public.

Kotak Mahindra Capital Company, Citigroup Global Markets India, JP Morgan India, HSBC Securities and Capital Markets (India), and IIFL Capital Services serve as the book-running lead managers for the offering.

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