The New Year is here and so are the new IPOs. With the last year ending on a high note in terms of the number and the amount raised by companies through IPOs, the trend is likely to continue this year as well. From Delhivery to giants like the NSE and LIC, a number of companies have lined up this year to come up with their IPOs.
The first company that is going to hit the public markets with its IPO is AGS Transact Technologies Limited IPO. The IPO is set to open for subscription on January 19, 2022 and will remain open for three days. So in this article, we’ll discuss about the company’s IPO in detail
AGS Transact Technologies Limited is one of the largest Omni-channel payment solutions providers in India in terms of providing digital and cash-based solutions to banks and corporate clients. The company provides services comprising ATM and CRM outsourcing, cash management and digital payment solutions including merchant solutions, transaction processing services and mobile wallets.
As of August 31, 2021, the company deployed 221,066 payment terminals and was one of the largest deployers of POS terminals at petroleum outlets in India. It was the second largest company in India in terms of revenue from ATM managed services under the outsourcing model and revenue from cash management and number of ATMs replenished.
AGS Transact Technologies Limited IPO Details
The company is coming up with the IPO issue price range of ₹166-₹175 per equity share. Each lot contains 85 shares of the company. After the issue, the promoter’s shareholding will reduce from 98.23% to 66.07%. The IPO is a pure offer-for sale and no fresh shares are going to be issued by the company.
At the upper band of the price range announced by the company, the PE ratio for the company comes out to 37.8, valuing it at a market capitalization of 2105 crores.
Utilization of offer proceeds by selling shareholders
Redemption/pre-payment of the company’s listed non-convertible debentures
To realize the benefits of listing of equity shares on the Stock Exchanges
To enhance the company’s brand name.
Key risks
The following are the key risks that the company may face:
The company’s business is vulnerable to the lockdowns imposed due to the outbreak of Covid-19.
The company derives a significant chunk of their revenues from the banking sector in India. Any adverse event in this sector could pose a risk to the company.
Any adverse development in the growth of number of Automated Teller Machines (ATM) or their usage could have an adverse effect on their business.
The company earns around 40% of their revenues from just three banks, which poses a concentration risk.
A decrease in the usage of cash in the economy can also have an adverse impact on the company’s business.
Key strengths
The following are the strengths of the company:
The company is an Omni-channel integrated payment and cash solutions provider.
The company has a customer driven portfolio with strong capabilities to develop customized solutions in-house.
The company has a diversified product portfolio, customer base and revenue streams leading to cross-selling opportunities.
It has a long standing relationship with technology providers and customers, and dedicated in-house infrastructure and technological capabilities.
The company has experienced board of directors and a senior management.
AGS Transact Technologies Fundamentals
For financial years 2021, 2020, and 2019, the company’s total income was ₹1797 crores, ₹1833.5 crores, and ₹1823.6 crores respectively. The company’s EBITDA was ₹476 crores, ₹495 crores, and ₹442.8 crores for the years 2021, 2020, and 2019 respectively. And the company’s EBITDA margin was 26.5%, 27%, and 24.3% respectively.
The company’s return on net worth for the years ending March 31, 2021, 2020 and 2019 was 10.29%, 16.70%, and 15.91% respectively. The company’s net asset value per equity share as on March 31, 2021 was ₹47.11.
AGS Transact Technologies Limited Financials
Year
Revenue
Expenses
Profit After Tax
2019
₹1827
₹1381
₹66.19
2020
₹1834
₹1338
₹83.01
2021
₹1797
₹1320
₹54.79
AGS Transact Technologies Limited Financials
AGS Transact Technologies Peer comparison
As per the company’s prospectus, there are no listed companies in India whose business portfolio is comparable with that of the company’s business model and its scale of operations. So it is not possible to provide and industry comparison in this regards.
AGS Transact Technologies IPO Registrar
Link Intime India Private Limited C-101, 1st Floor, 247 Park L.B.S. Marg, Vikhroli West Mumbai 400 083, Maharashtra
Contact Person: Ms. Sneha Kadam Company Secretary and Compliance Officer Email:[email protected]
Website: www.agsindia.com
Corporate Identity Number: U72200MH2002PLC138213
Conclusion
Discussed above are the details of AGS Transact Technologies Limited IPO that an investor needs to and should know before deciding to invest in the company’s IPO. From company details to fundamentals to valuations, a gist of everything has been provided.
AGS Transact Technologies Limited is going to be the first IPO of 2022! But a worrying aspect of the IPO is that no fresh proceeds are going to be utilized by the company and everything will go to the selling shareholders. Everything else might be fine with the company, but the company’s owners selling their stake is surely a red flag!
FAQ
When is AGS Transact Technologies IPO Date?
The Initial Public Offering (IPO) of AGS Transact Technologies, will open on 19 January, 2022
How is AGS Transact Technologies IPO Investors Portion are distributed?
Here is the details of Investor distribution: QIB is 50%, NII is 15%, and Retail is 35%.
How to Apply the AGS Transact Technologies IPO?
To apply for AGS Transact Technologies IPO, you can apply via ASBA through your bank account, also you can apply via ASBA IPO Application form via UPI through Strock trading platforms like Zerodha, Upstox, Angelone etc.
What is AGS Transact Technologies IPO Size?
AGS Transact Technologies IPO size is ₹680 crores.
When is the AGS Transact Technologies IPO Listing Date?
AGS Transact Technologies IPO Listing dates is on February 1, 2022, And it will be listed on both exchanges BSE and NSE.
