Unicommerce IPO subscribed 125x on Day 3 so far; NII portion booked over 200 times

The initial public offering (IPO) of Unicommerce eSolutions continued to attract a bumper response from the investors during the third and final day of the bidding process, bucking the weak sentiments for other IPOs. The issue, which had kicked off for bidding on Tuesday, August 06, ended day one with nearly 2.5 times bidding.
 

The Okhla-based Unicommerce eSolutions is selling its shares in the price band of Rs 102-108 apiece. Investors can apply for a minimum of 138 shares and its multiples thereafter. It is looking to raise Rs 276.57 crore via IPO, which is entirely an offer-for-sale of up to 2.56 crore equity shares.
 

According to the data, the investors made bids for 1,75,11,32,922 equity shares, or 124.33 times, compared to the 1,40,84,681 equity shares offered for the subscription by 3.05 pm on Thursday, August 08. The three-day bidding for the issue, which had opened on Tuesday, August 06, concludes today.
 

The allocation reserved for non-institutional investors (NIIs) saw a subscription of 202.39 times, while the portion reserved for retail investors was subscribed 110.71 times. The quota set aside for qualified institutional bidders (QIBs) quota was 89.84 times as of the time.
 

Incorporated in February 2012, Unicommerce eSolutions is a SaaS platform that manages e-commerce operations for brands, sellers, and logistics providers. The company offers a range of software products to help businesses efficiently manage their e-commerce operations after purchase.
 

The grey market premium of Unicommerce eSolutions has seen a decent increase despite the volatility in the broader markets on the back of strong bidding. Last heard, the company was commanding a premium of Rs 55 in the unofficial market, suggesting a listing pop of about 51 per cent for the investors. However, the premium in the grey market stood at 50 a day ago.
 

Brokerage firms are mostly positive on the issue suggesting investors to subscribe to it for a long term. They see it as a key beneficiary of the rising e-commerce trend in India, strong product profile, sound financials, positive cash flows, scope of expansion. However, stretched valuations and low-entry barriers are the major risks for the company.
 

Unicommerce eSolutions is bringing the issue at a price band of Rs 102-108 per share at P/E multiple of 85 times on post issue FY24 PAT basis. The company being the largest e-commerce enablement SaaS products platform, said Hem Securities with a 'subscribe' rating for the IPO.
 

"The company is the transaction processing or nerve centre layer, comprehensive and modular suite of products with a wide range of plug-and-play integrations makes it an integral part of client’s tech stack, large, growing and diversified base of marquee Indian and global clients with long-term relationships and the capability to upsell or cross-sell new and additional product," he said.
 

Unicommerce eSolutions has raised Rs 124.5 crore through its 11 anchor investors, where it allocated 1,15,23,831 shares at Rs 108 apiece. It reported a net profit of Rs 13.08 crore for the year ended on March 31, 2024, while its profit stood at Rs 6.48 crore in the year ago period. The company's revenue stood at Rs 109.43 crore for FY24 and Rs 92.97 crore in the fiscal year 2022-23.
 

The e-commerce sector remains a lucrative sector driven by rapid technological advancements and evolving consumer behaviours. As the leading e-commerce enablement SaaS platform in India, the company benefits from its robust position, demonstrated by its profitability and substantial market share, said DRChoksey FinServ.
 

"The company's flexible solutions and extensive integrations are crucial in addressing the complex needs of e-commerce operations, including inventory management, order fulfilment, and regulatory compliance. Unicommerce has also demonstrated impressive international growth," it added with a 'neutral' rating.
 

Unicommerce eSolutions has reserved 75 per cent of the net offer for the qualified institutional bidders (QIBs), while non-institutional investors (NIIs) will get 15 per cent of the net offer. Remaining 10 per cent of the net offer shall be allocated for retail investors.
 

IIFL Securities and CLSA India are the book running lead managers of the Unicommerce eSolutions IPO, while Link Intime India is the registrar for the issue. Shares of the company shall be listed at both BSE and NSE, with Tuesday, August 13 as the tentative date of listing.

 

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