About the Company:
Newgen Software Technologies is a software products company offering a platform that enables organisations to rapidly develop powerful applications addressing their strategic business needs.
The applications created on their platform enable organisations to drive digital transformation and competitive differentiation.
Company’s enterprise-wide, mission-critical solutions have been used by some of the leading global businesses in various sectors including banking, government/PSUs, BPO/IT, insurance and healthcare.
They have long-standing relationships with their customers, which include 17 Global Fortune 500 companies. This is, in part, due to the high criticality of company’s products to many of their customer’s business needs.
As of June 30, 2017,they operated in more than 60 countries and Management believes that they have a significant opportunity to grow their international footprint.
As of June 30, 2017,they had over 450 active customers (invoiced in the last 12 months) in a wide variety of verticals, including banking, government/PSUs, BPO/IT, insurance and healthcare.
Company’s business has diversified revenue streams including from license fees or subscription fees (in case of cloud deployment), implementation and development charges, ATS/AMC (Annual Maintenance Contract & Annual Technical Support).
Through their Subsidiaries and global offices,They are present in India, USA, Dubai, Singapore, Canada and UK.
Company’s customers use their platform to rapidly design, build and implement enterprise-grade custom applications through their intuitive, visual interface with minimal coding.
Company’s platform comprises of:
- Enterprise Content Management (ECM):
- Business Process Management (BPM):
- Customer Communication Management (CCM):
Company has Multiple revenue streams such as:
Sale of software products: one-time upfront license fees in relation to the platform deployed on-premise
Annuity based revenue: recurring fees/charges from the following:
- SaaS: subscription fees for licenses in relation to platform deployed on cloud
- ATS/AMC: charges for annual technical support and maintenance (including updates) of licences, and installation.
- Support: charges for support and development services.
Key Customers of the Company:
Competitors for the Company:
Newgen Software Technologies compete with a variety of software product and IT companies, as well as service providers.They also face competition from global and Indian enterprise solution companies.
Company’s global competitors in enterprise software platforms providers primarily include, Alfresco, OpenText, Hyland, IBM, Kofax, Appian, Pega, Microsoft, Oracle, Xerox, K2 and GMC Software.
Region wise Revenue Breakup:
| Region | Fiscal 2017 (in Crores) | Percentage wise (%) |
|---|---|---|
| India | 1,69.23 | 39.62 |
| EMEA* | 1,16.51 | 27.28 |
| USA | 1,11.27 | 26.05 |
| APAC (ex-India)# | 30.07 | 7.05 |
| Total | 4,27.09 | 100% |
* EMEA refers to Europe, Middle East and Africa
# Asia-Pacific excluding India
Sector wise Revenue Breakup:
| Sector | Fiscal 2017 (in Crores) | Fiscal 2013 (in Crores) | CAGR Growth (%) |
|---|---|---|---|
| Banking | 2,01.86 | 95.01 | 20.73% |
| Government/PSUs | 75.43 | 21.38 | 37.05% |
| BPO/IT | 50.71 | 38.60 | 7.06% |
| Insurance | 21.65 | 12.96 | 13.68% |
| Healthcare | 17.07 | 7.86 | 21.39% |
| Others | 60.34 | 25.29 | 24.28% |
| Total | 4,27.09 | 2,01.12 | 20.72% |
Management Team:
- Mr.Diwakar Nigam (Designation: Chairman and Managing Director)
- Mr.T.S. Varadarajan (Designation: Whole-time Director)
- Ms.Priyadarshini Nigam (Designation: Whole-time Director)
Promoters Average Acquisition Cost:
| Name of the Promoter | No. of Shares held | Average Acquisition Cost (in Rs.) |
|---|---|---|
| Diwakar Nigam | 18,422,406 | 1.02 |
| T.S. Varadarajan | 15,009,306 | 0.76 |
Promoters Stake Pre & Post Issue:
| Shareholder Name | Pre Issue Stake (%) | Post Issue Stake (%) |
|---|---|---|
| Promoters | ||
| Diwakar Nigam | 28.19% | 26.60% |
| T.S. Varadarajan | 22.96% | 21.67% |
| Promoter Group Entities | ||
| Priyadarshini Nigam | 12.19% | 11.50% |
| Usha Varadarajan | 6.93% | 6.54% |
| Total | 70.27% | 66.31% |
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Objectives of the Issue:
Offer for Sale: (Around Rs.330 crores)
- Company will not receive any proceeds from the Offer for Sale by the Selling Shareholders.
Fresh Issue: (Around Rs.95 crores)
- Purchase and furnishing of office premises near Noida-Greater Noida Expressway, Uttar Pradesh.
- General corporate purposes.
Fund Utilization:
| Particulars | Amount (Rs. in Crores) |
|---|---|
| Purchase and furnishing of office premises near Noida-Greater Noida Expressway, Uttar Pradesh | 84.34 |
| General Corporate Expenses | 10.66 |
| Net Proceeds | Rs.95 Crores |
Peer Group Comparison:
- There are no listed entities in India which are similar to Newgen Software Technologies line of business and comparable to company’s scale of operations.Hence we cannot make any Comparison.
Positives for the Company:
- Company sells their software through licenses and subscriptions and intend to grow the revenue both by adding new customers and by increasing the number of users at existing customer organisations.
- Profitable track record, strong balance sheet and stable cash flows.
- Plans to Expand the business and geographical footprint.
- Software product company with strong industry recognition.
- Diversified business across several verticals.
Financials of the Company:
| (in Crores) | FY 13 | FY 14 | FY 15 | FY 16 | FY 17 |
|---|---|---|---|---|---|
| Revenue | 205.55 | 255.16 | 316.21 | 349.67 | 433.76 |
| Net Profit | 36.95 | 41.08 | 46.38 | 27.82 | 52.36 |
IPO Details:
| Details | Info |
|---|---|
| Issue Opens on | 16th January 2018 |
| Issue Closes on:. | 18th January 2018 |
| Issue Price | Rs.240 – 245 |
| Face Value | Rs.10 |
| Minimum Lot | 61 |
| Minimum Investment | Rs.14,945 |
| Issue Constitutes | 25.03% |
| Issue Size | Rs.424.62 cr ($67 million) |
| Market Cap | Rs.1696 cr cr ($266 million ) |
| Listing at | NSE & BSE |
| Equity Shares Offered (OFS) | 1,34,53,932 |
| Equity Shares Offered (Fresh) | 38,77,551 |
| Total Equity Shares Offered (OFS + Fresh) | 1,73,31,483 |
| Equity Shares Prior | 6,53,58,150 |
| Equity Shares after the issue | 6,92,35,701 |
Important Dates:
| Finalization of Basis of Allotment | on or Before 23rd January 2018 |
| Initiation of Refunds | on or Before 24th January 2018 |
| Credit of Equity Shares: | on or Before 25th January 2018 |
| Listing Date: | on or Before 29th January 2018 |
IPO Valuation Parameters:
| Earnings Per Share (EPS) | Price To Earnings ratio (PE) | Return on Net Worth (RoNW) | Net Asset Value (NAV) |
|---|---|---|---|
| 10.53 | 23.26 | 19.06% | 43.34 |
Markets Guruji Opinion:
| IPO View | Apply For: | Expected listing Gain: |
|---|---|---|
| Subscribe | Long Term | 50% |
Grey Market Premium :
| Date | IPO | Price Band | Grey Market premium | Kostak Rates |
|---|---|---|---|---|
| 28/01/18 | Newgen Software Technologies Ltd | 240 – 245 | 63 – 65 | 1100 – 1250 |
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| Check IPO Allotment Status: |
|---|
Karvy Website (Click on the below Link)http://kosmic.karvy.com:81/ipotrack/ |
Subscription Details:
| (Subscription-Category-Wise (no. of times) Till time : 06:00 PM) | Shares Offered | Day-1 | Day-2 | Day-3 |
|---|---|---|---|---|
| QIB | 35,06,688 | 0.09 | 0.099 | 15.62 |
| NII | 26,11,840 | 0.004 | 0.032 | 5.52 |
| Retail | 60,94,293 | 0.32 | 1.34 | 5.04 |
| Employee | ——– | —– | —– | —– |
| TOTAL | 1,22,12,821 | 0.193 | 0.71 | 8.18 |
Anchor Investor Participation Update:
- Newgen Software Technologies raised around Rs.127.39 crore ($19.9 million) by selling shares to Anchor Investors.
- Shares were allocated to 9 investors at Rs.245 per share.
- Prominent names that participated in the anchor book allocation include Goldman Sachs India Ltd, HDFC Trustee Co. Ltd, Forefront Alternative Investment Trust, Aditya Birla Sun Life Pvt. Ltd, BNP Paribas Arbitrage and SBI Mutual Fund.
| Company Contact Info: |
|---|
| Newgen Software Technologies Limited A-6, Satsang Vihar Marg Qutab Institutional Area New Delhi 110 067, India Telephone: +91 11 4077 0100, 2696 3571, 2696 4733 Facsimile: +91 11 2685 6936 Website: www.newgensoft.com |
| IPO Registrar Info: |
|---|
| Karvy Computershare Private Limited Karvy Selenium Tower B Plot 31 and 32, Gachibowli Financial District, Nanakramguda Hyderabad 500 032 Telangana, India Tel: +91 40 6716 2222 Fax: +91 40 2343 1551 Email: einward.ris@karvy.com Grievance e-mail: newgen.ipo@karvy.com Website: www.karisma.karvy.com |
