Shares of Route Mobile Ltd made their stock market debut on Monday. The title listed at ₹717, i.e. a premium of 104.85% on its issue price of ₹350 pieces.
the ₹Route Mobile’s 600 crore issue was subscribed 73 times with a price range of Rs345-Rs350 per share. The initial public offering (IPO) was open for subscription from September 9 to 11.
“At the high end of the price bracket, the problem is valued at 29 times the FY20 earnings price, which is comparable to that of mid-sized IT companies,” said Sneha Poddar, analyst at research at Motilal Oswal Financial Services Ltd. Poddar added that Route Mobile’s strong presence in the niche CPaaS market with high barrier to entry and healthy finances makes it favorable.
The net proceeds of the issuance will be used to finance the repayment or prepayment, in whole or in part, of certain of the Company’s borrowings, acquisitions and other strategic initiatives, the purchase of offices in Mumbai and general corporate needs. business.
Between FY18 and FY20, the company experienced a compound annual growth rate (CAGR) of 37.6%. About 80.8% of Route Mobile’s revenue comes from exports and 19.2% from domestic customers. Route Mobile’s CPaaS (Communication Platform as a Service) platform facilitates omnichannel communication for multiple industries from small, medium and large enterprises, mobile network operators and OTT (over-the-top) players, which translates into increased engagement, customer loyalty and brand loyalty.
The company operates under prepaid and postpaid business models with high operating margins and a low cost base. The locally developed CPaaS platform is scalable, with limited capital expenditure requirements.
In fiscal 2020, Route Mobile processed over 30.31 billion billable transactions and, in the three months ended 2020, over 6.95 billion billable transactions. The company generated operating revenue of Rs504.9 crore, Rs844.6 crore, Rs956.2 crore and Rs309.6 crore in fiscal years 2018, 2019 and 2020, and in the three months ended June 30, 2020, respectively .
ICICI Securities Limited, Axis Capital Limited, Edelweiss Financial Services Limited and IDBI Capital Markets & Securities Limited were the lead managers of the issue.