Acropetal Technologies - IPO Note (Keynote Capitals)

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note of the IPO of Acropetal Technologies Ltd.

Issue Highlights

Price Band                                                    :     Rs88-90 per share                                                                            

Minimum Bid Lot Size                                  :     60 Equity Shares

Maximum Bid Lot Size                                  :     2,220 Equity Shares

IPO open during                                           :     February 21 - 24, 2011

Book Running Lead Managers                      :     Saffron Capital Advisors Private Ltd.

To list on                                                      :     NSE & BSE

IPO Grading                                                  :     3 / 5 (ICRA)

PE                                                                 :     4.62x (based on base price)*

                                                                     :     4.72x (based on cap price)*

Market Cap post-listing                                 :     Rs350Cr or $77.4mn (based on the cap price)

Market Cap of Free Float                               :     Rs196Cr or $43.3mn (based on the cap price)

*Based on FY10 EPS

IPO of 18.89mn equity shares of Rs10 each, aggregating to Rs170Cr or $37.6mn (at the cap price)

Executive Summery

Ø   Acropetal Technologies Limited (ATL) is engaged in the Engineering Design Services offering on a broader spectrum to reduce product design cycle time and costs.

Ø    The portfolio of services of ATL includes concept design, product design & development, advanced analysis, reliability engineering and value engineering with many other value added services offering to its customers.

Ø    ATL’s IT/ITES solutions in the enterprise space allow organisations to optimize their core business activities like resource management, customer relationship management and supply chain management.

Ø    ATL’s current offerings are focused on four major industry sectors: Infrastructure, BFSI/Retail, Health and Energy. It intends to offer complete end to end solution catering to these market segments that enables the company to obtain additional business from existing clients as well as potential new clients.

Ø    ATL, along with its group companies, has internally developed and built a strong product and services portfolio. It would continue to leverage on this domain expertise as well as the product portfolio to offer comprehensive solutions to its customers.

Ø    ATL has developed a strong customer base over the last few years. Its focus is to build on its existing customer relationship and offering new services to broaden the spectrum of its service offerings.

Our View

Considering the growth prospects and fundamentals of the company in mid-tier IT Services, the investors may look into the issue for subscription.