The rush for initial public offer or IPO among companies are seeing a continuous rush, with more and more firms deciding to go with the flow. Latent View Analytics IPO is once such example, with the company going in for its maiden issue earlier this week. The offer has already seen a massive response among investors. The three day offer will close on Friday, November 12, before it gets listed on the stock markets. Latent View Analytics, a data analytics firm, gives solutions to companies helping them with driving digital transformation and using data to gain a competitive advantage among its peers.
On Day 2 of the subscription, that is on Thursday November 11, the Latent View IPO was subscribed 23.22 times amid strong demand from investors. Retail investors and non-institutional buyers have been instrumental in the play. As per data, retail investors have bought shares 69.56 times the portion reserved for them by the end of Day 2. Non-institutional buyers have subscribed 33.29 of the shares reserved for them. Qualified institutional investors have, so far, bid for 3.51 times the portion reserved for them. Employees of Latent View Analytics have put in bids for 2.61 times the shares reserved for them. On the first day of the issue, the Latent View IPO was subscribed 6.39 times according to data.
Latent View IPO Details, Price
Latent View Analytics aims to raise Rs 600 crore through the IPO. Of this, Rs 474 crore is supposed to be raised though a fresh issue, while Rs 126 crore is set to be raised through an offer for sale (OFS) by selling shareholders. The company will not receive any proceeds from the OFS. The company has fixed a price band of Rs 190-197 a share for its maiden share sale. The lot size is 76 shares. Qualified institutional buyers can buy up to 75 per cent of the shares, while non-institutional investors can bid for 15 per cent of the shares. The remaining 10 per cent has been reserved for retail investors. The issue which opened on November 10 will close for bidding on Friday, November 12 after a three-day process.
Objectives of Issue
Axis Capital, ICICI Securities and Haitong Securities India Private Limited are the lead managers to the Latent View IPO. The company plans to utilise the proceeds from the fresh issue in funding inorganic growth initiatives (Rs 147.9 crore), working capital requirements of LatentView Analytics Corporation, its material subsidiary (Rs 82.4 crore). The proceeds will also be used for investment in subsidiaries to augment its capital base for future growth and for general corporate purposes.
Latent View IPO GMP Today
Latent View Analytics’ unlisted shares has been trading at Rs 487 in the grey market, according to IPO watch. Hence, Latent View IPO grey market premium was Rs 290 on Friday, November 12.
Should You Subscribe to Latent View IPO?
Anand Rathi: The company is available at the upper end of the IPO price band at 42.6x its FY21 earnings attributable to post issue equity, demanding a market cap of Rs. 38,963 million. At the upper End of the IPO price band, the issue is priced at a P/BV of 7.29x based on its NAV of Rs. 27.02 as of June 30, 2021. The Company has a healthy Margin profile with three years average RoNW of 21.15%. Considering the Company’s plan for inorganic growth, longstanding relationship with some of the fortune 500 companies, its leadership position in the Industry, we recommend a “Subscribe” rating to this IPO.
Reliance Securities: The IPO is valued at 42.6x FY21 earnings and 43.7x FY22 annualized earnings, which look to be reasonably priced. LVA states Happiest Minds Tech as its peer, which trades at an exorbitantly high valuation at 115x FY21 earnings. Notably, the growth in IT spend is expected to be largely driven by investment in digital technologies, as enterprises scale up digital transformation efforts across business units. The investment in digital technologies is expected to double from the 2020 levels to ~US$2.4tn in 2024 (~16.5% CAGR). This presents immense opportunity for LVA, which may aid it to sustain a doubledigit growth in subsequent years. Hence, we recommend SUBSCRIBE to this issue.
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