Looks like a good IPO to me
1) The offering is in the range of PE 15.5-17.7x which is attractive.
2) The company has shown strong growth 30% yoy (for past 3 years) and should continue to do so.
3) For the first quarter, it had a revenue of 587 crore and a profit of 106 crore which is a healthy profit margin. Plus balance sheet did not show an irrational rise in other income to temporarily raise the EPS.
4) The main promoter Mahindra group is a respected firm and should do good for the company
5) The major client British telecom (69% of revenue) has huge stakes in this venture, so is unlikely to leave the company in near future.
1) huge reliance on one major client
2) high attrition rate, and the company is just another outsourcing firm.
It got oversubscribed on the first day, and closed with an oversubscription of 70.15 times. Which is an history in itself. Finally a good response after a long lull in the primary market.
It is expected to be listed on 29th Aug.