Mumbai-based IT solutions provider, Orient Technologies, is poised to enter the capital markets with its initial public offering (IPO) opening for subscription on August 21. While the company has yet to disclose the price band, it is expected to reveal these details on August 16. The IPO subscription period will close on August 23, with the anchor book set to open a day earlier on August 20.
The IPO will comprise a fresh issuance of equity shares worth ₹120 crore, alongside an offer-for-sale (OFS) of 46 lakh equity shares from the company's promoters. Promoters Ajay Baliram Sawant, Umesh Navnitlal Shah, Ujwal Arvind Mhatre, and Jayesh Manharlal Shah will each divest 11.55 lakh equity shares as part of this OFS.
About the Company
Founded in 1997, Orient Technologies has established itself as a key player in the IT solutions space, specializing in IT Infrastructure, IT-Enabled Services (ITeS), and Cloud and Data Management Services. The company's extensive industry experience has enabled it to offer a comprehensive range of products and solutions across these sectors. Collaborating with renowned technology partners such as Dell International Services India Private Limited, Fortinet, Inc., and Nutanix Netherlands B.V., Orient Technologies delivers advanced technological solutions to its clients.
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IPO Details and Utilization of Proceeds
The total value of the Orient Technologies IPO is estimated at ₹214.76 crore, with ₹120 crore attributed to the fresh issue and the remainder from the OFS. The company plans to use the net proceeds from the fresh issue for general corporate purposes, including capital expenditure and the acquisition of an office building in Navi Mumbai.
The basis for share allocation is anticipated to be finalized on August 26, followed by the commencement of refunds on August 27. Orient Technologies is expected to debut on the BSE and NSE on January 29, with Elara Capital (India) Private Limited acting as the book-running lead manager and Link Intime India Private Ltd. serving as the issue’s registrar.
Financial Overview
Orient Technologies has demonstrated robust financial growth in recent years. For the fiscal year ending March 2024, the company reported an 8.2% year-on-year increase in profit, reaching ₹41.4 crore, while its revenue grew by 12.7% to ₹602.9 crore. The company’s EBITDA (earnings before interest, tax, depreciation, and amortization) for fiscal 2024 rose by 16.4% to ₹56.6 crore, with a margin improvement of 31 basis points to 9.4%.
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In fiscal 2024, 52.2% of Orient Technologies’ revenue was generated from its IT infrastructure products and services segment, 22.2% from IT-enabled services, and the remaining 25.6% from cloud and data management services. As of June 2024, the company’s order book stood at ₹101.2 crore, with significant contributions from the BFSI segment (₹20.5 crore) and government and PSU contracts (₹30.6 crore).
Industry Position
Orient Technologies operates in a highly competitive market, where it faces strong competition from major industry players like Dynacons Systems & Solutions, HCL Technologies, LTIMindtree, Wipro, Allied Digital Services, Dev Information Technology, and Tech Mahindra. The company’s upcoming IPO and its strategic financial decisions will play a crucial role in strengthening its position within the IT services industry.
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