Newgen Software Technologies IPO: Brokerage Views & Run up to IPO

This post on Newgen Software Technologies IPO tries to bring out consolidated brokerage views opinions, IPO Review / Analysis, Note/ reports and recommendation of brokerages , Analyst, Business New papers, Management views, Grey Market Premium, Subscription etc on Newgen Software Technologies IPO and shall be updated continuously till the closure of the issue. The information collated from various sources and reports in public domain can help investors to decide whether they should subscribe to Newgen Software Technologies IPO or not.

Related Posts: Newgen Software Technologies IPO Review

Subscription: Newgen Software Technologies IPO  ( x times)
  QIB NII Retail Total
Day 3  15.62  5.52  5.18  8.25
Day 2  0 .1  .03  1.33  0.7
Day 1 0.1 0.01 0.32 0.19
Total Applications at close= Application wise Subscription=
Newgen Software Technologies IPO: Grey Market Premium etc.

16/01/18 Grey Market Premium Rs. 30-50/- (Few Deals), Kostak: NIL, some place Rs. 300/-

Complete Anchor List

Anchor Investors (AIs) portion in the Public Issue of Newgen Software Technologies Limited, for 5,199,444 equity shares have been subscribed today by 9 AIs at Rs. 245/- per equity share. The Anchor Investors include Goldman Sachs, Alchemy Leaders of Tomorrow, HDFC Trustee Company Ltd., Malabar India Fund Limited, BNP Paribas Arbitrage Fund etc., Societe Generale etc.

Click here for Complete Newgen Software Technologies Anchor Investors List

Consolidated opinion of Brokerages, Analysts, Business New Paper Reports, Management Views on Newgen Software Technologies IPO .

Angel Broking: “In terms of valuations, the pre-issue P/E works out to 27.4x its 1HFY2018 annualized earnings (at the upper end of the issue price band),  Further last four years historical financial records and 1HFY18 doesn’t provides confidence. Hence, we recommend Neutral rating on the issue.

Capital Market
: “Score 40/100, Net sales increased 22% to Rs 383.12 crore and the operating profit margins were up 510 basis points to 17.4% in FY 2017. Net profit jumped 81% to Rs 50.16 crore. However net profit had fallen 35% from Rs 42.80 crore to Rs 27.65 crore in FY 2016. The OPM had fallen continuously from 23.2% in FY2013 to 12.3% in FY 2016 but recovered to 17.4% in FY 2017.  Net sales stood at Rs 182.78 crore and the OPM at 4.9% in the six months ended September 2047. Net profit stood at Rs 5.65 crore. Due to seasonality in business, profits cannot be annualized. At the upper band of Rs 245, P/E works out to 33.9 times EPS of Rs 7.2 (on post-IPO equity) for FY 2017. There are no listed entities in India which are similar to its line of business and comparable to its scale of operations.”

Choice Broking: Given the high sensitivity of business to global macro events, repellent receivable policy, completely exits of PE players and high demanding valuation, we are of the view that the issue is aggressively priced leaving no space for further upside. Thus we assign ‘Avoid’ rating to the issue”

Dalal Street Investment Journal: ” Score 43(Risky): On the upper price band of Rs. 245 with EPS of 10.11 as of FY17, company’s P/E works out at 24.2x. Some of the listed ace software companies have P/E in the range of 17x to 21x. The industry’s average P/E is around 19-20x. Considering this, it can be seen that the company is over-valued.”

Hem Securities:
“The co is bringing the issue at p/e multiple of 33 on FY17 eps of Rs 8.26 at higher price band of Rs 240-245/share. Looking after financials of co we recommend “Long Term Subscribe” on it.”

SMC : “
Rating 1/5 According to management, based on last five fiscal’s financial performance pattern, first half always contributes around 40% of revenues and balance comes in the second half with higher margins due to year end spending of customers. However, the revenues of the company are on the declining mode and also the issue looks expensive.”

SP Tulsiyan website: “Based on historic financial performance and lack of clarity on future earnings, the valuation is expensive. Better to gauge the performance over the next few quarters before evaluating Newgan as a candidate for investment. For now, it makes sense to skip the IPO.”

SSJ Finance: “NSTL has reported a CAGR of 20.7% and 9.1% on revenue and net profit fronts respectively over FY2013-2017. On its upper band of price of Rs 275, the issue is priced at PE ratio of 30.6x of its FY2017 EPS of Rs 8.0. We believe that the IPO is fairly priced leaving a room for upside. Hence, we recommend to Subscribe the IPO.

Leave a Reply