21-Sep-2023
2 mins read
Updater Services, a Chennai-based Integrated Facilities Management company, is set to open its Initial Public Offering (IPO) for subscription on September 25, concluding on September 27. Anchor investor allocation is planned for September 22, with the price band details yet to be released.
The IPO will consist of a fresh issuance of shares worth up to ₹400 crore, along with an Offer for Sale (OFS) featuring up to 8 million equity shares with a face value of Rs 10 each, contributed by the promoter and other stakeholders.
The company’s promoter, Tangi Facility Solutions Private Ltd, will divest 4 million shares through the IPO. Additionally, two private equity entities, India Business Excellence Fund-II and India Business Excellence Fund–IIA, are slated to sell 800,000 and 3.2 million shares, respectively.
Per the preliminary offering document, the net proceeds from the IPO will be allocated towards settling certain debts, bolstering working capital, engaging in inorganic business activities, and other general corporate uses.
Handling the IPO as book-running lead managers are IIFL Securities Ltd, Motilal Oswal Investment Advisors Ltd, and SBI Capital Markets Ltd. The issue’s registrar will be Link Intime India Private Ltd.
In the listed segment, Updater Services’ industrial counterparts include:
- Quess Corp Ltd (with a P/E ratio of 28.38).
- SIS Ltd (with a P/E ratio of 19.74).
- TeamLease Services Ltd (with a P/E ratio of 40.96).
Last week, the company secured the necessary approvals from the Securities and Exchange Board of India (SEBI) to proceed with the IPO.
Updater Services Limited Product Portfolio
Founded in 1990 by seasoned industry professional Raghunandana Tangirala, Updater Services Ltd has risen to prominence in India’s business services landscape, specialising in integrated facilities management (IFM) and business support services (BSS). With Tangirala’s three decades of expertise at the helm, the company has garnered a broad clientele, serving over 1,300 businesses across India.
Within the realm of IFM and its allied services, the company offers a comprehensive set of solutions that extend beyond just soft services, production assistance, and engineering support to also encompass warehouse management. As time has passed, the company has seamlessly expanded its range of offerings to include additional value-added services such as pest control and horticulture. For the fiscal year that ended in 2022, the company experienced a rise in its revenue, recording Rs 1,483.55 crore, up from Rs 1,210.03 crore in the previous fiscal period. Likewise, net profits saw a positive movement, climbing to Rs 57.4 crore compared to Rs 47.5 crore in the year prior.
The Objectives of Updater Services Limited IPO
The primary goals of the new share issue are multi-fold. Initially, the company intends to allocate the raised funds toward settling and/or pre-emptively paying off particular debts it has incurred. Subsequently, a portion of the proceeds will be directed to fortify the firm’s working capital, facilitating uninterrupted daily operations. Third, the capital raised will be invested in inorganic growth opportunities to broaden the company’s scope and reach. Lastly, a portion of the funds will be set aside for various general corporate activities and necessities.
Financial Performance of Updater Services Limited (In Crore)
| Period Ended | 31-Mar-21 | 31-Mar-22 | 31-Mar-23 |
| Assets | 579.49 | 874.57 | 1,216.95 |
| Revenue | 1,216.35 | 1,497.89 | 2,112.09 |
| Profit After Tax | 47.56 | 57.37 | 34.61 |
| Net Worth | 285.26 | 340.43 | 380.89 |
| Total Borrowing | 11.61 | 58.68 | 176.54 |
Important Dates for Updater Services Limited IPO
| IPO Date | September 25, 2023 to September 27, 2023 |
| Listing Date | Yet to be announced |
| Face Value | Rs 10 per share |
| Price | Yet to be announced |
| Lot Size | Yet to be announced |
| Total Issue Size | Yet to be announced |
| Fresh Issue | Aggregating up to Rs 400 Crore |
| Offer for Sale | 8,000,000 shares of Rs 10 |
| Issue Type | Book Built Issue IPO |
| Listing At | BSE, NSE |
| Shareholding pre issue | 53,369,355 |
Important Dates for Updater Services Limited IPO
| IPO Open Date | Monday, September 25, 2023 |
| IPO Close Date | Wednesday, September 27, 2023 |
| Basis of Allotment | Wednesday, October 4, 2023 |
| Initiation of Refunds | Thursday, October 5, 2023 |
| Credit of Shares to Demat | Friday, October 6, 2023 |
| Listing Date | Monday, October 9, 2023 |
| Cut-off time for UPI mandate confirmation | 5 PM on September 27, 2023 |
Updater Services IPO Reservation
| QIB Shares Offered | Not less than 75% of the Offer |
| NII (HNI) Shares Offered | Not more than 15% of the Offer |
| Retail Shares Offered | Not more than 10% of the Offer |
Updater Services IPO Promoter Holding
| Shareholding Pre Issue | 80.58% |
| Shareholding Post Issue | Yet to be announced |
Updater Services Limited IPO Lead Manager
Iifl Securities Ltd, Motilal Oswal Investment Advisors Limited and SBI Capital Markets Limited are the lead managers of the company.
Promoters of the Updater Services Limited IPO
The promoters of the company are Raghunandana Tangirala, Shanthi Tangirala and Tangi Facility Solutions Private Limited.
How to Apply for Updater Services Limited IPO
Wait for the public issue to open for subscription, then click on this link to apply for the Updater Services Limited IPO with Bigul https://ipo.bonanzaonline.com/.
How to Check the Allotment Status of Updater Services Limited IPO
The registrar for Updater Services Limited IPO is Link Intime India Private Ltd. To check your allotment status, please click on this link https://linkintime.co.in/mipo/ipoallotment.html.
FAQs
- What is the main purpose of the Fresh Issue?
The Fresh Issue aims to achieve several key objectives, including the repayment or prepayment of specific company borrowings, funding working capital needs, investing in inorganic growth initiatives, and covering general corporate expenses.
- Will the Fresh Issue help in debt reduction?
Yes, one of the primary goals of this new share issue is to repay or prepay existing loans, thereby potentially reducing the company’s debt burden.
- How will the Fresh Issue affect working capital?
A portion of the funds raised will be allocated to meet the company’s working capital requirements, ensuring that day-to-day operations continue smoothly.
- What does “Pursuing inorganic initiatives” mean?
“Pursuing inorganic initiatives” refers to the company’s plan to use some of the proceeds to invest in external growth opportunities, such as mergers and acquisitions, rather than organic growth that comes from existing operations.
- What are ‘general corporate purposes’?
General corporate purposes may include a range of activities such as research and development, marketing initiatives, capital expenditure, or any other operational costs that are not specified but are crucial for the company.
- Who will oversee the allocation and utilisation of the funds from this issue?
The company’s board of directors, in compliance with applicable laws and regulations, will oversee the allocation and utilisation of the proceeds from this Fresh Issue.
- How can investors participate in the Fresh Issue?
Detailed instructions on how to participate will be provided in the issue’s offering documents, which will be made publicly available before the issue date.
- Is this Fresh Issue suitable for all types of investors?
While the Fresh Issue is designed to provide various benefits, such as debt reduction and funding for growth, it’s essential for investors to read all available documents and understand the risks involved before investing. Consulting a financial advisor is always recommended.
- When will the Fresh Issue be open for subscription?
The opening and closing dates for subscription will be announced alongside the release of the issue’s offering documents.