Mumbai-based Orient Technologies Limited, a fast-growing information technology (IT) solutions provider, has filed its Draft Red Herring Prospectus (DRHP) with capital market regulator Sebi to raise funds for its Initial Public Offering (IPO). Like most IPOs, Orient Technologies IPO will be a mix of fresh issue and a sale by existing shareholders.
The upcoming IPO has a face value of INR 10 and consists of a fresh issue of INR 120 crore and an offer for sale of up to 4.6 million equity shares by the Promoter Selling Shareholders.Â
The offer for sale (OFS) component in Orient Technologies IPO consists of the sale of equity shares of up to 1,150,000 by Ajay Baliram Sawant, up to 1,150,000 equity shares by Umesh Navnitlal Shah, up to 1,150,000 equity shares by Ujwal Arvind Mhatre, and up to 1,150,000 equity shares by Jayesh Manharlal Shah.
Not more than 50% of shares in Orient Technologies IPO shall be available for allocation on a proportionate basis to qualified institutional buyers, not less than 15% of the offer shall be available for allocation to non-institutional investors, and not less than 35% of the offer shall be available for allocation to retail individual investors.
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Orient Technologies IPO: Issue Objectives
The proceeds from the fresh issue, to the extent of INR 79.65 crore for funding its capital expenditure requirements; INR 10.35 crore for the acquisition of office premises at Navi Mumbai; and General Corporate Purposes.
Orient Technologies IPO: Business Overview
Orient Technologies commenced its business in the year 1997 and was co-founded by Ajay Baliram Sawant, Jayesh Manharlal Shah, Ujwal Arvind Mhatre, and Umesh Navnitlal Shah. Over the years, the company has developed deep expertise in creating products and solutions for specialized disciplines across IT Infrastructure, IT Enabled Services (ITeS) and Cloud and Data Management Services. It collaborates with top technology companies like Dell, Fortinet, and Nutanix to offer advanced solutions tailored to meet the specific needs of their customers.
As of December 31, 2023, Orient Technologies boasted a diverse clientele spanning both public and private sectors, including industries like Banking, Financial Services, Insurance (BFSI), Information Technology (IT), ITeS, Healthcare / Pharmaceuticals, among others.
The company has cultivated strong relationships with notable clients such as Coal India, Mazagon Dock, D’Décor, Jyothy Labs, ACG, Integreon, Bluechip, Tradebulls, Vasia Janta Bank, Vasai Vikas Bank and Joint Commissioner of Sales Tax (GST Mahavikas), Mumbai.
Orient Technologies IPO: Products and Services
The Product and Services offered by Orient Technologies, within IT Infrastructure, comprises of Data Centre Solutions and End-User Computing. The IT Infrastructure has a track record of being the longest operational business segment and also the largest revenue generating segment. The segment has added new products making it a broad-based offering, and growing at a CAGR of 58.60% between fiscal 2021 and fiscal 2023.
It recently ventured into ‘Device as a service (DaaS)’. Under DaaS, the company provides desktops, laptops, tablets, printers, scanners, smartphones, and servers, bundled with software, along with managed services on a ‘pay-per-use’ model i.e. on a subscription basis.
In the ITeS segment, it includes an array of services like Managed Services, IT Facility Management, Security Services, etc., supported by a skilled workforce. This segment has shown steady growth over the years. The industry’s domestic revenue is expected to touch INR 43,000 – 46,000 crore by Fiscal 2027, clocking a CAGR of 6-8% between Fiscal 2023 and Fiscal 2027, primarily driven by the BFSI and government sector.
The company’s Cloud and Data Management Services encompass offerings such as data analytics, business analytics, RPA on a subscription basis. Additionally, the company provides various cloud services such as Infrastructure as a Service (IaaS), Platform as a Service (PaaS), etc., leveraging its expertise and partnerships for competitive advantage.
As of December 31, 2023, Orient Technologies’ order book stood at INR 92.75 crore.
Orient Technologies IPO: Nationwide Presence
The Company primarily operates in India and has sales and services offices in several cities across India, including Navi Mumbai, Pune, Ahmedabad, New Delhi, Bengaluru, and Chennai. Additionally, it has a branch office in Singapore.
Orient Technologies IPO: On a Strong Financial Footing
For FY 2023, the company’s revenue from operations increased to INR 535.10 crore from INR 467.44 crore in FY 2022, primarily due to increase in revenue from IT & IT infrastructure products and services, Cloud and DMS, and ITES services. Profit after tax increased 14.35% from INR 33.49 crore in fiscal 2022 to INR 38.30 crore in fiscal 2023.Â
For the six months ended September 30, 2023, revenue from operations stood at INR 266.31 crore, and profit after tax stood at INR 16.39 crore.
Elara Capital India is the sole book-running lead manager for Orient Technologies IPO, and Link Intime India Private is the registrar of the offer. The equity shares are proposed to be listed on the BSE and NSE.Â
