Orient Technologies IPO opens today: Should you subscribe?

The initial public offering (IPO) of Orient Technologies begins trading today, that is, on Wednesday, August 21. The IT solutions provider is selling its shares in a fixed price band of Rs 195-206 each. Traders can apply for a minimum of 72 shares and more thereafter. Applications for this matter can be made until Friday 23 August.

Incorporated in 1997, Orient Technologies based in Mumbai is a fast growing IT solutions provider. The company has developed extensive expertise in developing products and solutions for specific areas within its business environment.

The Rs 214.76 crore IPO of Orient Technologies includes a fresh sale of shares worth Rs 120 crore and an offer for sale (OFS) of up to 46 lakh equity shares by the company’s promoters- Ajay Baliram Sawant, Umesh Navnitlal Shah, Listen. Arvind Mhatre, Jayesh Manharlal Shah-worth Rs 94.76 crore.

The proceeds from this issue will be used to acquire offices in Navi Mumbai; financial capital requirements for the purchase of equipment to establish a network operations center (NOC) and a security operations center (SOC); purchase of equipment and tools to provide devise-as-a-service (DaaS); and general business plans.

Ahead of its IPO, Orient Technologies has raised Rs 64.43 crore from five anchor investors by allotting them 31,27,572 shares for Rs 206 each. Anchor investors in this issue include names like Pine Oak Global Fund, Saint Capital Fund, SB Opportunities Fund, Elara Capital (Mauritius), and Rajasthan Global Services.

Orient Technologies offers a wide variety of customized offerings and its ability to tailor solutions to meet specific customer needs has enabled it to attract prominent customers in various industries. They serve leading public and private organizations in various client industries, such as banking, financial services, insurance (BFSI), IT, ITeS, and healthcare/pharmaceuticals.

It specializes in IT systems, IT-enabled services (IteS), and cloud and data management services. The company’s clients include Bluechip Corporate Investment Center, Tradebulls Securities, Vasai Janata Sahakari Bank, Vasai Vikas Sahakari Bank, Integreon Managed Solutions India, Coal India, Mazagon Dock, Joint Commissioner of Sales Tax, Mumbai and D’Décor.

Orient Technologies reported a net profit of Rs 41.45 crore, and revenue of Rs 606.86 crore for the financial year ended March 31, 2024. The company had posted a net profit of Rs 38.3 crore on revenue of Rs 542.01 crore for the year of 2022-23.

50 percent of Orient Technologies’ online production is reserved for institutional investors, while non-institutional investors will receive 15 percent of the production. Retailers will have 35 percent of the donation allocated to them.

Elara Capital (India) is the sole book-runner for the Orient Technologies IPO, while Link Intime India is the underwriter for the issue. The company’s shares will be listed on both the BSE and the NSE, with Wednesday, August 28 being the estimated listing date. Here’s what brokerage firms are saying about Orient Technologies’ IPO:

Research by Anand Rathi
Details: Register
Orient Technologies deals in IT solutions and related services that provide business networking. In the high price category, the company has a P/E value of 20.7 times with a market capitalization of Rs 858 crore post equity shares and a return to value of 27.2%, said Anand Rathi Research.

“Its business operations include advanced technology solutions that the company collaborates with a number of technology partners including Dell International Services India (Dell) and Fortinet, Inc (Fortinet) and Nutanix Netherlands BV (Nutanix ) that the company is cheap,” added the ‘subscribe’ details for that matter.

StoxBox
Details: Register
India’s IT Services industry is primarily export-oriented, with exports accounting for 85% of total revenue, with North America and Europe being key destinations. It has shown steady revenue, Ebitda and PAT growth at a compound annual growth rate CAGR of 13.7 percent, 12.9 percent and 11.2 percent during FY 22-24, respectively, said StoxBox.

Orient Tech’s financial performance may be influenced by expanding its product and services, increasing global standards, and long-term relationships with customers. The issue is valued at a P/E of 20.7 times to the higher price group based on FY24 earnings, which is considered fair compared to its peers,” it added in a ‘subscribe’ note.

Arihant Capital Markets
Rating: Register for Long Term
Orient Tech is well positioned for strong growth with its comprehensive IT solutions, which include IT Infrastructure, IT Enabled Services (ITeS), and Cloud and Data Management Services. Its recent foray into the device-as-a-service (DaaS) market exemplifies its approach, offering a complete hardware and software solution, it said. Arihant Capital.

“It is well-positioned to tap into areas with growing demand for advanced IT services, leveraging its extensive expertise and solid client track record. Its diverse client base and expertise A deep technology base, supported by strategic alliances with leading technology providers, enhances its ability to meet a wide variety of customer needs and capture opportunities in emerging global markets. yes,” it added with a ‘long-term subscription’ tag.

Master Capital Services
Details: Register
Orient Technologies offers a wide range of products and services ranging from data center solutions to cloud and data management services. Its latest foray into DaaS will offer desktops, laptops, tablets, printers, scanners, smartphones and servers, complete with software, as well as managed services in the form of ‘ pay by use’, said Master Capital.

“The company plans to expand its geographical area and cater to more customers worldwide. The company has established a branch in Singapore which mainly deals with the business of computer equipment such as servers, storage and online resources. Investor’s looking to invest in IPO for the medium to long term,” it added.

Swastika Investmart
Condition: Sign up with Caution
Orient Tech boasts exceptional clients across a variety of industries. The company’s comprehensive IT solutions and steady financial growth highlight its strong market position. However, reliance on key customers, technology collaboration and government tenders, as well as intense competition, present potential challenges, said Swastika Investmart.

“The IPO is valued at a P/E ratio of 17.45 times, which seems reasonable. After considering all the factors, we recommend that there is a balance to register this IPO, but investors should take a careful approach,” it added.