AGS Transact IPO subscription status: AGS Transact IPO sails through on Day 2; retail, NII quota fully subscribed
The issue was subscribed 1.01 times by 11.15 am, the second day of the bidding process. The issue received applications for 2,90,37,530 shares so far against on offer 2,86,74,696 shares. The portion reserved for retail and HNI investors was fully subscribed while the QIB portion was yet to see bidding.
The promoter is selling shares in the Rs 166-175 range. Interested investors can bid for them in a lot of 85 shares and in multiples thereof. The company will be valued at Rs 2,107 crore if it lists at the higher end of the IPO price.
The issue is an offer for sale mostly from the company’s promoter. The company will not get any proceeds directly, though the fund will eventually flow into it via a different mechanism, which the company will use to reduce its debts.
Majority of analysts have been positive over the issue, thanks to its growth prospects and strong portfolio. Though a few have raised the flags over the premium valuations, losses reported in the current fiscal and debts in the books.
Marwadi Shares and Finance said considering the FY-21 adjusted EPS of Rs 4.55 on a post-issue basis, the company is going to list at a P/E of 38.46x with a market cap of Rs 2,106.9 crore.
It has given subscribe with caution rating to one of the largest omni-channel integrated payment and cash solutions providers as the high debt in the books of the company keeps the brokerage cautious from a long term perspective.
Ahead of the public bidding, the payment solutions provider on Tuesday raised Rs 204 crore from anchor investors. The company allotted over 1.16 crore equity shares to anchor investors at Rs 175 apiece.
Ashoka India Equity Investment Trust Plc, Kuber India Fund, Saint Capital Fund, IIFL Special Opportunities Fund, Abakkus Growth Fund, HDFC Mutual Fund (MF), Nippon India MF and Quant MF are among the anchor investors.
“AGS has high client concentration with top three customers accounting for 33.6 per cent of revenues and has reported a loss for the first five months of FY 2022,” Angel One said while giving a ‘Neutral’ rating to the issue due to premium valuations, high client concentration and losses.
AGS Transact provides customized products and services comprising ATM and CRM outsourcing, cash management and digital payment solutions including merchant solutions, transaction processing services and mobile wallets.
As of March 31, 2021, the company was the second-largest company in India in terms of revenue from ATM managed services under the outsourcing model, and revenue from cash management and number of ATMs replenished.
