Seshaasai Technologies Limited, a Mumbai-based multi-location tech solutions provider, has received the green signal from the Securities and Exchange Board of India (SEBI) to go ahead with its highly anticipated Initial Public Offering (IPO). This approval marks a significant milestone for the company, which filed its Draft Red Herring Prospectus (DRHP) on December 27, 2024.

The IPO will be a combination of fresh equity shares worth ₹600 crore and an Offer for Sale (OFS) of up to 78.74 lakh equity shares by existing shareholders Pragnyat Pravin Lalwani and Gautam Sampatraj Jain, both part of the promoter group.

Pre-IPO Placement and Final Issue Size

Although the issue price and dates are yet to be disclosed, Seshaasai Technologies may consider a pre-IPO placement of up to ₹120 crore. If this is executed, the total value of the fresh issue will be reduced accordingly.

The IPO is being handled by leading financial institutions – IIFL Capital Services, ICICI Securities, and SBI Capital Markets – acting as book-running lead managers (BRLMs).

Use of IPO Proceeds

The company has laid out a strategic plan for the utilisation of the proceeds from the Fresh Issue:

• Expanding existing manufacturing infrastructure

• Increasing production capabilities to meet demand

• Repaying or prepaying outstanding borrowings

• Funding general corporate expenses

This planned deployment of capital is aimed at strengthening the company’s position across its core and emerging markets.

Financial Performance Overview

Seshaasai Technologies reported robust financial growth in FY24, driven by increasing demand across its key verticals. Some key highlights include:

• Revenue from operations stood at ₹1,558.26 crore, a 35.9% increase from ₹1,146.30 crore in FY23.

• Gross Profit rose to ₹570.35 crore, up 42.21% from ₹400.91 crore in the previous fiscal year.

This consistent upward trajectory in earnings reflects the company’s operational strength and its growing relevance in high-demand sectors.

Company Background and Market Position

Seshaasai Technologies delivers end-to-end integrated technology solutions across payments, communications, and fulfilment, primarily to the Banking, Financial Services, and Insurance (BFSI) sector. The company is a critical player in enabling digital and physical transactions for top-tier financial institutions in India.

A notable diversification of Seshaasai’s services includes Internet of Things (IoT) solutions. This segment supports industries beyond BFSI, thereby adding depth to its technology footprint.

What sets Seshaasai apart is its strong market position in the payment card manufacturing space. In FY24, the company emerged as one of the top two card producers in India, holding a 34.5% market share in debit and credit card issuance. This is a significant leap from 23.7% in FY22, showcasing its rapid growth and increasing trust among clients.

Sector Outlook and IPO Timing

The upcoming IPO is well-timed, considering the surge in investor interest in the technology, financial infrastructure, and manufacturing segments. With a healthy balance sheet and a fast-growing customer base, Seshaasai is well-positioned to benefit from the IPO not just for capital raising but also to elevate its brand visibility and corporate governance standards.

Given its technological strengths, growing verticals, and increasing client base, the IPO is expected to receive a strong response from institutional and retail investors alike.

Conclusion

Seshaasai Technologies' IPO reflects a broader trend in the Indian capital markets, where tech-enabled solution providers with a diversified presence are seeing enhanced investor interest. The funds raised will empower the company to expand operations, invest in next-gen manufacturing, and reduce financial leverage, setting the stage for long-term value creation.

Stay tuned for the final DRHP and IPO dates, which are expected to be announced shortly. This will be one of the more prominent IPOs in the mid-cap tech infrastructure space in 2025.

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