Workmates Core2 BSE SME IPO review

•    The company enjoys AWS partner’s tag for cloud and digital transformations related services.
•    With rising AI and Gen AI initiatives, the company is poised for bright prospects ahead.
•    It marked growth in its top and bottom lines for the reported periods.
•    Based on its recent financial data, the issue appears lucratively priced.
•    Investors can lap it up for medium to long term rewards.

ABOUT COMPANY:
Workmates Core2Cloud Solution Ltd. (WCSL) is a cloud and digital transformation companies, dedicated to helping enterprises modernize, secure, and scale their digital core. In just six years, it has grown from a start-up to a Premier Tier AWS Partner — a distinction recognised for only a select group globally by AWS. This status reflects its deep technical expertise, proven customer success, and ability to deliver complex cloud projects at scale. Completely bootstrapped and built with unwavering passion and grit, Workmates is a successfully well steered company to date. It is recently recognized as the AWS Consulting Partner of the Year 2025, a testament to its excellence in delivery, innovation, and customer satisfaction.

At the heart of its journey lies mission to empower businesses to reach their full potential through reliable and innovative cloud solutions. WCSL’s vision is to become the leading cloud services provider, known not just for what it delivers, but how the company delivers — with precision, agility, and integrity. Its core values — Customer Focus, Innovation, Accountability, Teamwork, and Integrity — guide everything it does and defines how it builds long-term, trust-based relationships with clients. With its strong foundation, forward-looking approach, and relentless focus on customer success, Workmates is well-positioned to ride the next wave of digital transformation across industries and geographies.

Workmates delivers a full spectrum of cloud and cloud-centric services — spanning workload assessment, seamless migration, application modernization, and end-to-end managed services — in strategic collaboration with Amazon Web Services (AWS). Its solutions are designed not only to move businesses to the cloud but to enable them to unlock the full potential of digital transformation and Generative AI with agility, security and scale. As an AWS Premier Consulting Partner in India, Workmates is one of the few select group of AWS partners globally, recognized for technical excellence, consistent delivery performance, and deep customer impact. The company holds seven AWS Competencies, each demonstrating its ability to deliver specialized services across key domains, from cloud operations and DevOps to data analytics and industry-specific workloads. Beyond AWS, its strength lies in integrating technologies from leading OEMs into cloud solution, allowing it to offer contextual, scalable, and secure cloud solutions tailored to diverse enterprise needs. 

With AWS, a hyperscale cloud provider, as its foundation, Workmates is uniquely positioned to help organizations fast-track innovation, operational efficiency, and AI-led transformation in today’s rapidly evolving digital economy. WCSL’s comprehensive range of services enables it to partner with customers throughout their entire cloud and digital transformation journey, Now further strengthened by the growing adoption of AI and Generative AI technologies into cloud technology. Its engagement typically begins with a thorough assessment of the customer’s existing IT landscape to understand their business needs and readiness for the cloud. The company then designs and executes a seamless migration and implementation plan that ensures minimal disruption and maximum value. Post-migration, it helps customers modernize their applications to fully leverage cloud-native capabilities, improving agility, scalability, and performance. Beyond the initial transformation, its managed services provide continuous monitoring, optimization, security, and compliance support ensuring customers derive ongoing value, efficiency, and innovation from their cloud environment. 

This end-to-end capability positions WCSL not just as a service provider for one-time migrations, but as a long-term digital partner driving sustainable growth and transformation for clients. In addition to its core cloud services, the company offers integration of cybersecurity solutions of third-party OEMs into cloud to ensure that its customers’ digital environments remain secure, compliant, and resilient. As businesses increasingly rely on cloud platforms, protecting sensitive data and ensuring secure operations has become critical. The company integrates leading cybersecurity tools and best practices into every stage of the cloud journey covering threat detection, data protection, access control, and compliance so that customers can operate confidently in a secure digital environment. Building on this foundation, it also helps customers leverage the power of Artificial Intelligence (AI) and Generative AI (Gen AI) to unlock new business value from their data into cloud. Using advanced tools available on the AWS platform and other leading technologies, it integrates and provides intelligent solutions ranging from smart automation and chatbots to predictive analytics and personalized user experiences. These AI capabilities help its clients innovate faster, reduce manual effort, and gain actionable insights, making technology a real driver of growth and differentiation. As of August 31, 2025, it had 168 employees on its payroll.

ISSUE DETAILS/CAPITAL HISTORY:
The company is coming out with its maiden IPO of 3423600 equity shares of Rs. 10 each to mobilize Rs. 69.84 cr. The company has announced a price band of Rs. 200 – Rs. 204 per share. The issue opens for subscription on November 11, 2025, and will close on November 13, 2025. IPO comprises 2908800 fresh equity shares (worth Rs. 59.34 cr. at the upper cap), and an Offer for Sale (OFS) of 514800 equity shares (worth Rs. 10.50 cr. at the upper cap). The minimum number of shares to be applied is for 1200 shares and in multiples of 600 shares thereon, thereafter. Post allotment, shares will be listed on BSE SME. The issue constitutes 26.50% of the post-IPO paid-up capital of the company. From the net proceeds, the company will utilize Rs. 29.20 cr. for working capital, Rs. 8.60 cr. for prepayment/repayment of loans, and the rest for general corporate purposes. According to the management, with AWS strategy as its foundation, it is gaining grounds as indicated by its recent 100% CAGR for Top and Bottom lines for the last three fiscals, and is poised for speedy growth in coming years with rising demand.

The IPO is solely lead managed by Horizon Management Pvt. Ltd., and MUFG Intime India Pvt. Ltd., is the registrar to the issue. Giriraj Stock Broking Pvt. Ltd., is the Market Maker for the company. Horizon Management is also a syndicate member. The issue is underwritten to the tune of 15% by Horizon Management, and 85% by Giriraj Stock Broking Pvt. Ltd.

After issuing entire initial equity shares at par value, the company issued bonus shares in the ratio of 1000 for 1 in May 2025. The average cost of acquisition of shares by the promoters is Rs. NIL, Rs. 0.01, and Rs. 19.98 per share. 

Post-IPO, company’s current paid-up equity capital of Rs. 10.01 cr. will stand enhanced to Rs. 12.92 cr. Based on the upper price band of the IPO, the company is looking for a market cap of Rs. 263.54 cr. 

FINANCIAL PERFORMANCE:
On the financial performance front, for the last three fiscals, the company has (on a consolidated basis) posted a total income/net profit, of Rs. 29.14 cr. / Rs. 1.86 cr. (FY23), Rs. 53.53 cr. / Rs. 5.35 cr. (FY24), and Rs. 108.39 cr. / Rs. 13.93 cr. (FY25). For 5M of FY26 ended on August 31, 2025, it earned a net profit of Rs. 7.22 cr. on a total income of Rs. 59.55 cr. 

For the last three fiscals, the company has reported an average EPS of Rs. 9.05 and an average RoNW of 58.90%. The issue is priced at a P/BV of 6.78 based on its NAV of Rs. 30.07 as of August 31, 2025, but its post-IPO NAV data is missing from the offer documents.

If we attribute FY26 annualized super earnings on post-IPO fully diluted equity capital, then the asking price is at a P/E of 15.21. Based on FY25 earnings, the P/E stands at 18.92. The issue relatively appears lucratively priced. 

For the reported periods, the company has posted PAT margins of 6.38% (FY23), 9.99% (FY24), 12.85%, (FY25), 12.12% (5M-FY26), and RoCE margins of 100.85%, 122.44%, 64.61%, 30.14%, respectively for the referred periods. 

DIVIDEND POLICY:
The company has not paid any dividends for the reported periods of the offer document. It will adopt a prudent dividend policy post listing, based on its financial performance and future prospects. 

COMPARISION WITH LISTED PEERS:
As per the offer document, the company has shown Persistent Systems, Orient Techno., and LTIMindree, as its listed peers. They are currently trading at a P/E of 55.5, 38.3 and 34.2 (as of November 04, 2025. However, they are not truly comparable on an apple-to-apple basis. 

MERCHANT BANKER’S TRACK RECORD:
This is the 21st mandate from Horizon Management in the three fiscals (including the ongoing one).  From the last 10 listings, 2 listed at discount, 3 at par and the rest listed with a premium ranging between 3.08% and 74.37% on the listing date.