Home >Markets >Stock Markets >Happiest Minds makes bumper stock market debut, soars 138% over issue price
Ashok Soota, executive chairman, Happiest Minds. (File photo: Mint)
Ashok Soota, executive chairman, Happiest Minds. (File photo: Mint)

Happiest Minds makes bumper stock market debut, soars 138% over issue price

  • The stock was listed at 350, a whopping premium of 110.84% from its issue price of 166 per share

Shares of Happiest Minds Technologies Ltd made a strong stock market debut on Thursday. After hitting an intraday high of 394.95 apiece on the NSE, the scrip jumped 137.92%.

The shares of the IT firm were listed at 350, a whopping premium of 110.84% from its issue price of 166 per share. At 11:59 am, the stock traded at 379.65, up 29.65 or 8.47% on the NSE.

The 702 crore initial public offering (IPO), sold during 7-9 September at a price band of 165-166 per share, was subscribed 150.98 times.

Proceeds of the IPO will be used to meet Long term working capital requirements and general corporate purposes. The issue was lapped up among investors due to its valuations and business prospects especially post covid-19 outbreak when there is general shift towards digital products.

“At the higher end of the price band, the issue is valued at 29 times FY20 price to earnings (PE), which is comparable to larger mid-sized IT companies," said analysts at Motilal Oswal Financial Services Ltd. Its strong presence in digital services, scalable business model with end-to-end capabilities and fast improving financial performance are some of the factors that analysts at the brokerage firm like about Happiest Minds.

The company derives 97% of its revenues from digital IT services by offering services like cloud, SaaS, security, analytics and IoT, compared to 30-50% for traditional Indian IT services peers. It caters to multiple business verticals of which major contribution comes from edutech (21% in FY20), Hitech (21%), BFSI (18%) and TME (travel, media and entertainment 17%).

Over FY18-20, its revenue grew at a CAGR of 23% to 700 crore, while it stood flat for Q1FY21. Its EBITDA margin improved from -4% in FY18 to 13.9% in FY20 and 21.4% in Q1FY21. Its average revenue per customer has increased from $471,472 in fiscal 2018, to $ 501,562 in fiscal 2019 to $614,675 in fiscal 2020.

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