Hexaware Technologies is getting ready to launch its Initial Public Offering (IPO) anticipated as one of the biggest in the IT services industry’s history. Hexaware Technologies IPO aims to gather about INR 9,950 crore marking the company’s comeback to the stock market after being delisted in 2020 following the takeover by private equity giant Carlyle. Hexaware Technologies IPO is set to be among the largest in India’s IT services sector since Tata Consultancy Services (TCS)’ public offering in 2002.
Hexaware Technologies IPO: Business Overview and Growth Strategy
Since its inception in 1990, Hexaware Technologies has grown to become a global player in the worldwide IT services and business process management sector. With operations in than 34 nations and a workforce of approximately 30,000 employees the company generates around USD 1. 3 billion in annual revenues. Hexaware provides an array of services, such, as IT consulting, cloud computing, data analytics and artificial intelligence solutions.
Hexaware has emphasized innovation and digital transformation in its growth strategy. Has recently made significant acquisitions reflecting this focus on enhancement in these key areas of operation. A notable acquisition by the company is Softcrylic—an analytics and data firm—aimed at boosting its capabilities in line with a vision of prioritizing AI technology first. This strategic move is in line with the CEO R Srikrishna’s vision for integrating AI with expertise for driving value, within the business operations.
Hexaware’s acquisition of Softcrylic aligns with its overarching plan to strengthen its service portfolio and stay ahead in the changing IT environment landscape. This action reflects the trend in the industry where companies are turning to mergers and acquisitions to improve their technological expertise and broaden their market presence. Similar strategies have been employed by market leaders such as TCS and Infosys who are relying on expansion of their digital service offerings through strategic acquisitions.
Hexaware Technologies IPO: Impressive Turnaround
In the last three years, the company has turned in a robust financial performance. In 2023, Hexaware reported revenues of INR 10,380.3 crore, marking a year-on-year growth of 12.8%. This milestone signifies Hexaware’s ability to expand its client base and enhance service offerings, particularly in digital transformation and AI solutions.
Similarly, its profit before tax for 2023 stood at INR 1,268.5 crore, reflecting a growth of 13.0% y/y. This increase indicates effective cost management and operational excellence, allowing Hexaware to maintain healthy profit margins even amidst market fluctuations. Adjusted EBITDA reached INR 1,685.2 crore, with a growth rate of 14.9%.
India’s Red Hot IPO Market: 52 Listings in 2024
Hexaware Technologies IPO filing comes at a time when investor appetite for promising businesses is touching new highs. At the time of writing this article, 52 companies have listed on mainboard stock exchanges so far in 2024. An overwhelming 42 of these gave positive returns to investors with average being a healthy 29.65%.
This initial public offering stands out because it follows Hexawares delisting in 2020 when the Carlyle Group acquired it for around USD 3 billion. Carlyle’s support has boosted confidence in Hexaware’s opportunities and prepared the company for a triumphant return to the stock market.
In summary, Hexaware Technologies IPO signifies a milestone for the company and mirrors the increasing positivity surrounding the Indian IT services industry. It offers investors a chance to benefit from the growth potential of the IT services industry. The syndicate for the IPO includes leading investment banks such as Kotak Mahindra Capital, Citigroup, JP Morgan, IIFL Capital, and HSBC Securities.
