Sagility India Makes Tepid Debut with 3.5% Premium on Stock Exchanges

Sagility India Ltd.’s stock market debut on Tuesday, November 12, was subdued. Sagility India shares are listed at ₹31.06 on both the NSE and BSE, which was just 3.53% higher than its issue price of ₹30 per share.

IPO Subscription and Investor Response

Sagility India’s IPO was open for subscription from November 5 to November 7 and was subscribed 3.20 times. The retail investor portion was oversubscribed 4.16 times, while qualified institutional buyers (QIBs) subscribed 3.52 times. Non-institutional investors subscribed 1.93 times, and the employees’ portion was oversubscribed 3.75 times.

The IPO was offered at a fixed price band of ₹28-30 per share, with a lot size of 500 shares. The company raised approximately ₹2,107 crore through the public offer, all of which was through an offer-for-sale by its sole promoter, Sagility BV, based in the Netherlands. The proceeds from the issue will go to the selling shareholder, not Sagility India.

Details of the IPO and Shareholding

Sagility India’s parent company, Sagility BV, reduced its stake in the company by 15%, retaining 85% of its shareholding after the IPO. Initially, the IPO size was planned to be 98.44 crore shares but was reduced to 70.2 crore shares in the final offer.

Financial Performance

Sagility India posted a 47.5% drop in profit for Q1 FY24, with earnings of ₹22.3 crore, mainly due to reduced operating margins and higher taxes. However, revenue rose by 9.6% to ₹1,223 crore. EBITDA fell by 26% to ₹193.9 crore, with margins shrinking by 777 basis points to 15.85%.

For the full FY24, Sagility reported a 59% increase in net profit to ₹228 crore, driven by lower finance costs and higher other income. Revenue grew by 12.7% to ₹4,753.6 crore, while EBITDA rose by 5.9% to ₹1,088 crore. However, operating margins declined by 150 basis points to 22.9%.

Lead Managers and Registrar

The IPO was managed by ICICI Securities Ltd, IIFL Securities Ltd, Jefferies India Private Limited, and JP Morgan India Private Limited as the book-running lead managers. Link Intime India was the registrar for the issue.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.