Review By on March 28, 2017
Dev Information Technologies Ltd (DITL) is engaged in the Information Technology Industry. The company is providing a range of Information Technology (“IT”) solutions including enterprise solutions, e-governance solutions, ERP and CRM Implementation, IT – infrastructure services, website development, web hosting solutions and licensing solutions. Also the company is into custom software development with well-defined processes to support its clients and partners in –web portals, web & mobile applications, responsive websites, their SEO & Social Media Marketing as well as Microsoft Dynamics ERP and CRM. In addition to above DITL also provides end-to-end IT services with strong managed IT team to monitor and manage customer’s servers and infrastructure - 24x7.
To part finance its working capital and general corpus fund needs, the company is coming out with a maiden IPO of 14,88,000 equity share of Rs. 10 each at a fixed price of Rs. 42 per share to mobilize Rs. 6.25 crore. Issue opens for subscription on 31.03.17 and will close on 06.04.17. Minimum application is to be made for 3000 shares and in multiples thereon, thereafter. Post allotment, shares will be listed on NSE SME Emerge. Issue is solely lead managed by Hem Securities Ltd and Link Intime India Pvt Ltd is the registrar to the issue. Most of its equity is issued at par and 56500 shares issued as other than cash at a consideration of Rs. 414.16 per share in February 2017. It has also issued bonus shares in the ratio of 8 for 1 (in March 2013), 1 for 2 (in April 2016) and 4 for 1 (in March 2017). Its current paid up equity capital of Rs. 4.03 crore will stand enhanced to Rs. 5.52 crore post issue.
On performance front, the company has (on a consolidated basis) posted revenue/net profits of Rs. 43.32 cr. /Rs. 0.57 cr. (FY13), Rs. 57.56 cr. / Rs. 1.11 cr. (FY14), Rs. 45.95 cr. / Rs. 1.27 cr. (FY15) and Rs. 46.45 cr. / Rs. 2.06 cr. (FY16). For the first half of the current fiscal it has earned net profit of Rs. 1.16 crore on revenue of Rs. 20.02 crore. If we annualize latest earnings and attribute on the fully diluted equity post issue, then asking price is at a P/E of around 10 and P/BV of 1 plus against industry composite P/E of around 18. Thus issue appears to have been priced reasonably.
On merchant banker’s front, this is the 31st mandate from its stable since FY 13-14. Last 10 IPOs (excluding Laxmi Cotspin) have given some rewards on listing date (as per prospectus details).
Conclusion: Reasonable pricing and the bottom line growth makes this issue worth considering for medium to long term.
Review By on March 28, 2017
Dilip Davda is a veteran financial journalist associated with the Indian stock market since 1978. He has been contributing to print and electronic media on capital markets, insurance, and finance since 1985.
He is widely recognized for reviewing public issues and non-convertible debentures (NCDs) in the primary market. Drawing on over three decades of market experience and close interaction with merchant bankers, his reviews focus on detailed fundamental and financial analysis of companies, with a special emphasis on SME public issues.
Dilip Davda
SEBI Registered Research Analyst – Mumbai
Registration No.: INH000003127 (Perpetual)
Email: dilip_davda@rediffmail.com
Disclaimer: The information provided herein is solely for educational and informational purposes and does not constitute an offer, solicitation, or recommendation to buy or sell any securities. Readers are advised to consult a qualified financial advisor before making any investment decisions. Investments in the securities market are subject to market risks. The author does not intend to invest in the securities discussed.
The initial public offer (IPO) of Dev Information Technology Ltd. offers an early investment opportunity in Dev Information Technology Ltd.. A stock market investor can buy Dev Information Technology IPO shares by applying in IPO before Dev Information Technology Ltd. shares get listed at the stock exchanges. An investor could invest in Dev Information Technology IPO for short term listing gain or a long term.
Read the Dev Information Technology IPO recommendations by the leading analyst and leading stock brokers.
Dev Information Technology IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the Dev Information Technology IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts mentioned in the above answer to "How is Dev Information Technology IPO?"
Our recommendation for Dev Information Technology IPO is to subscribe.
As per the analysis by our lead analyst Mr. Dilip Davda, we suggest you to subscribe to the Dev Information Technology IPO.
The Dev Information Technology IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit Dev Information Technology IPO allotment status to check.
