Happiest Minds IPO: Should You Subscribe or Not?

Happiest Minds IPO: Happiest Minds IPO fully subscribed, retail book 10 times on Day 1

On 1st day of bidding, Happiest Minds Technologies IPO is seeing a good response from retail investors so far.

Happiest Minds IPO Opens 7-9 September 2020

The IPO has seen a 1.97 times subscription so far as it has received bids for 4.59 crore equity shares against IPO size of over 2.32 crore shares (excluding anchor book), as per the data available on exchanges showed.

The reserved portion of retail investors has subscribed 10-times and that of non-institutional investors 34.89 percent, while the portion set aside for qualified institutional investors has seen 8 percent subscription.

The Bengaluru-based IT firm has launched its Rs 702 crore public issue today and the same will close on September 9. The company already raised Rs 316 crore through anchor investors book on September 4.

The issue consists a fresh issue of Rs 110 crore and an offer for sale of 3,56,63,585 equity shares by promoter Ashok Soota and investor JP Morgan-backed private equity fund CMDB II.

The Happiest Minds IPO Share Price fixed at Rs 165-166 per share.

“At upper price band it is offered at 23.6x FY2020 EPS. Considering the very high exposure to digital services and strong promoter background we expect that the company will continue to grow at a faster pace as compared to similar sized companies and therefore should command a premium valuation to the peer group. We would therefore recommend investors to subscribe to the IPO,” said Yash Gupta, Equity Research Associate at Angel Broking.

Happiest Mind Company is a small sized IT services company promoted by Ashok Soota, who is also the Executive Chairman and Director of the company.

Before founding Happiest Mind in 2011, Soota was one of the founding members of MindTree prior to which he was also the vice chairman of Wipro.

Company has strong presence in digital technologies to drive growth for the company. In FY2020, 96.9 percent of company’s revenues came from digital services and is amongst the highest Indian IT companies.

The company is divided into three business units viz. 1) Digital Business processing 2) Product Engineering Services and 3) Infrastructure management and security services.

The company had 148 active customers as of Q1FY2021 with the share of repeat business growing consistently over the year to account for a significant portion of revenues indicating a high degree of customer stickiness, said Yash Gupta.

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