Excelsoft Technologies Files DRHP with SEBI for Rs 700 Crore IPO
SaaS company Excelsoft Technologies has taken a significant step toward going public by filing its Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) to raise Rs 700 crore through an Initial Public Offering (IPO).
IPO Structure and Fund Allocation
The proposed IPO consists of a fresh equity issue worth Rs 210 crore and an Offer for Sale (OFS) component of Rs 490 crore by the promoter-selling shareholders—Pedanta Technologies and Dhananjaya Sudhanva.
According to the DRHP, the company plans to utilize the net proceeds for several strategic initiatives:
- Funding capital expenditure for purchasing land and constructing a new building
- Upgrading and improving external electrical systems at its existing facility in Mysore
- Enhancing the company's IT infrastructure
- General corporate purposes
Interestingly, Excelsoft has also mentioned the possibility of a pre-IPO placement through either a further issue of equity shares up to Rs 30 crore or through a secondary sale of equity. Should this materialize, the fresh issue size would be reduced proportionately.
Company Profile and Global Presence
With over two decades of industry experience, Excelsoft Technologies has established itself as a provider of technology-based solutions across diverse learning and assessment segments. The company operates through long-term contracts with enterprise clients worldwide.
As of December 2024, Excelsoft serves 71 clients spread across 17 countries, including the USA, UK, India, Singapore, Australia, Japan, Malaysia, Saudi Arabia, UAE, and Canada.
The company has built an impressive roster of prominent and long-standing clients, including:
- Pearson Education
- AQA Education
- Colleges of Excellence
- NxGen Asia
- Pearson Professional Assessments
- Sedtech for Technology Education & Learning WLL
- Ascend Learning LLC
- Brigham Young University – IDAHO
- Training Qualifications UK
- Surala Net
- Excel Public School
- The Chartered Quality Institute
Financial Performance
For the fiscal year 2024, Excelsoft reported revenue from operations of Rs 198.3 crore and a profit after tax (PAT) of Rs 12.75 crore. According to the draft prospectus, there are no listed companies or peers in India that have a business composition and segment contribution similar to Excelsoft, highlighting its unique position in the market.
Industry Outlook and Market Trends
The global SaaS (Software as a Service) market has experienced rapid growth in recent years, with vertical SaaS emerging as a dominant trend. Vertical SaaS solutions offer specialized, industry-tailored applications that address specific sector needs.
This shift toward specialization has positioned vertical SaaS to grow at an even faster pace than general SaaS offerings. According to an Arizton report cited in the DRHP, vertical SaaS could account for nearly 50% of the entire SaaS market by 2030, representing a significant opportunity for companies like Excelsoft that focus on specific verticals such as education and assessment.
IPO Details and Listing Plans
Anand Rathi Advisors has been appointed as the Book Running Lead Manager for the IPO. Following the successful completion of the offering, Excelsoft's equity shares are proposed to be listed on both the BSE (Bombay Stock Exchange) and NSE (National Stock Exchange).
For retail investors and market participants interested in the education technology and SaaS sectors, this IPO represents an opportunity to invest in a company with established global operations and a focus on the rapidly growing vertical SaaS market.
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