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About FirstMeridian Business Services Limited IPO
FirstMeridian Business Services Limited IPO is an IPO of ₹740 crores. It consists of an offer for sale aggregating up to ₹690 crores and a fresh issue aggregating up to ₹50 crores. The shares will be allotted on a date that is yet to be announced. The credit of shares to the demat account will take place on a date that is yet to be announced and the initiation of refunds will take place on a date that is yet to be announced.
Objective of FirstMeridian Business Services Limited IPO
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Repayment and/or prepayment of all or certain portion of outstanding borrowing (including accrued interest) availed by one of their subsidiaries, namely Innovsource Services Private Limited.
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General corporate purposes.
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In addition, the company expects to receive the benefits of listing the Equity Shares on the Stock Exchanges and enhancement of the company’s brand name amongst their existing and potential customers, and creation of a public market for their Equity Shares in India.
FirstMeridian Business Services Limited IPO Valuation
| Detail | Information |
|---|---|
Upper Price Band (₹) | TBA |
Existing Shares to be Sold | 690 crores |
Fresh Issue | ₹50 crores |
EPS (₹) For the year ended March 31, 2022 | 4.67 |
FirstMeridian IPO Share offer and Subscription Details
| Investor Category | Shares Offered |
|---|---|
QIBs Share Offered | Not less than 75% of the Net Issue |
NIB Shares Offered | Not more than 15% of the Net Issue |
Retail Shares Offered | Not more than 10% of the Net issue |
Industry Outlook
The total human resource solutions market size is estimated to be ₹16,450.00 billion in the financial year 2022, with the market growing by a CAGR of 13.1% between the financial year 2016 to the financial year 2020, and by 4.0% in the financial year 2021. India has the second largest working-age population in the world, a critical element that will drive the growth of the staffing solutions market in India. India’s working-age population is expected to increase by over 113 million from 2021 to 2036.
Source: F&S Report
Company Information
FirstMeridian Business Services Limited is India’s third largest staffing company, in terms of revenues for the financial year ended March 31, 2022 (Source: F&S Report). The services provided include:
- General staffing and allied services
- Global technology solutions and
- Other HR services.
The company provides clients with associates to operate in various functional roles, such as sales and marketing, customer services, warehouse management, delivery and factory staff. The number of associates increased to 126,824 as of September 30, 2022, and 118,082 as of March 31, 2022, compared to 86,690 as of March 31, 2020.
Strengths of FirstMeridian Business Services Limited IPO
First Meridian is India’s third-largest staffing company in an industry characterized by economies of scale
FirstMeridian is India’s third largest staffing company, in terms of revenue for the financial year ended March 31, 2022 (Source: F&S Report). They have a pan-India presence with over 53 branch offices and Associates deployed at over 3,500 locations as on September 30, 2022.
Diversified business across multiple end-user industries and clients
Across their entire service offerings, they have a diverse client base from a variety of industries, with telecommunications, retail, BFSI and construction and infrastructure industries contributing ₹4,50.546 crores, ₹3,52.721 crores, ₹2,09.461 crores and ₹1,58.114 crores, respectively, representing approximately 25.96%, 20.33%, 12.07%, and 9.11%, respectively of their total revenue from operations.
Demonstrated track record of organic and inorganic growth and integration
They have an established track record of organic and inorganic growth through strategic acquisitions that have helped them enhance the scale of their business operations and diversify revenue streams. These acquisitions have been instrumental in their rapid growth over the past four years since their inception to becoming the third largest staffing company in India.
Risks of FirstMeridian Business Services Limited IPO
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The company has a history of losses and has experienced negative cash flows from operating, investing, and financing activities in the past.
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A significant portion of their business is attributable to certain large clients. Any deterioration of the client’s financial condition or prospects may have an adverse impact on FirstMeridian’s business. Further, if they fail to expand the size of their business with existing clients or expand to new clients, or if they lose their large clients, their business, revenue, profitability, and growth will be adversely affected.
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The business is subject to extensive government regulation, which may restrict the types of services that are permitted to be offered or result in additional tax or other costs that reduce its revenue and earnings.
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Demand for their staffing services may decline whereby human labour is or may be replaced by or disrupted by technology and automation, which may adversely affect their business prospects, operations and financial condition.
All Financial Information about FirstMeridian
Particulars (in Rs. crores)
Particulars (in Rs. crores)
Comparison with peers
| Parameter | FirstMeridian | Quess Corp Limited | Team Lease Services Limited |
|---|---|---|---|
Revenue From Operations for the year ended March 31, 2022 (₹ in crores) | 2862.123 | 13691.778 | 6479.823 |
P/E | - | 24.88 | 109.64 |
EPS (Basic) | 4.67 | 16.32 | 22.48 |
Return on Net Worth for equity shareholders (%) | 8.56% | 9.90% | 5.54% |
NAV per share | 54.82 | 173.57 | 412.83 |
Anchor Investor Information
The anchor investor bidding will take place one day before the IPO opens. The exact date is yet to be announced.
IPO Registrar and Book Running Lead Managers
Book Running *Lead Managers:
JM Financial Limited
DAM Capital Advisors Limited
Edelweiss Financial Services Limited
IIFL Securities Limited
Registrar for the IPO is Link Intime India Private Limited
Business Model
FirstMeridian Business Services Limited is a fast-growing company with an asset-light business model. The company earns its revenues from the following sources by providing a wide range of service offerings, including:
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General staffing and allied services, by offering contract staffing solutions, workforce automation solutions and trade marketing solutions to meet business needs of clients across diverse industries.
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Global technology solutions that are offered through short-and long-term technology contract staffing solutions for clients.
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Other HR services, including permanent recruitment, recruitment process outsourcing (RPO), pharmaceutical and healthcare staffing, facility management, engineering and technical staffing, and finance accounting and legal staffing.
Where each of their services are offered under different brand names.
Company Growth Trajectory
The number of the company’s Associates increased to 126,824 as on September 30, 2022, and 118,082 as on March 31, 2022, as compared to 86,690 as on March 31, 2020.
The revenue from operations increased to ₹28,62.123 crores as on March 31, 2022 from ₹20,58.437 crores as on March 31, 2020, representing a CAGR of approximately 17.92%. The revenue from operations amounted to ₹17,35.238 crores for the six-month period ended on September 30, 2022, and ₹13,06.240 crores for the six-month period ended on September 30, 2021.
Company Market Position
FirstMeridian Business Services Limited is India’s third-largest staffing company in an industry characterized by economies of scale. The company has developed sector-specific capabilities that have enabled it to serve a diverse client base in a wide range of industries, including telecommunications, retail, banking, financial services and insurance (“BFSI”), construction and infrastructure, information technology (“IT”) and information technology-enabled services (“ITES”), e-commerce, manufacturing and engineering, and logistics.
FirstMeridian Business Services Limited Company Profit & Loss
| Parameter | FY20 | FY21 | FY22 |
|---|---|---|---|
Total Income (₹ crores) | 20,75.401 | 21,24.176 | 28,69.376 |
`Restated profit/(loss) before tax | 272.30 | 296.14 | 228.42 |
Net Profit (₹ crores) | 19.611 | 33.656 | 34.092 |
EBITDA (₹ crores) | 35.502 | 39.414 | 73.024 |
EPS (₹) basic | 2.72 | 4.66 | 4.67 |
FirstMeridian Business Service Limited Cash Flow Statement
| Parameter | FY20 | FY21 | FY22 |
|---|---|---|---|
Profit before tax (₹ crores) | 27.230 | 29.614 | 22.842 |
Net Cash used in Operating Activities | (238.52) | 467.99 | 591.33 |
Net Cash used in Investing Activities | 5.83 | (505.30) | (144.69) |
Net Cash used in Financing Activities | 117.84 | (249.84) | 1,562.87 |
How To Check Allotment Status of FirstMeridian Business Service Limited IPO?
You can check the allotment status of shares either on the website of the Bombay Stock Exchange (BSE) or on the website of the registrar Link Intime India Private Limited. To check the status on the BSE website:
- Visit the BSE website
- Click on “Investor Services” and choose “Application Status Check”
- Choose the issue type — Equity or Debt (Equity in this case)
- Select the Issue Name from the drop-down. The issue name is the company’s name, which is FirstMeridian Business Service Limited
- Enter your application number or PAN number
- Check the box which says “I’m not a Robot” and click on “Search” to know the allotment status
Follow these steps to know the allotment status on the registrar’s website:
- Visit the Link Intime India Private Limited website
- Choose “Public Issues” from the “Investor Services” drop-down
- Select FirstMeridian Business Service Limited from the drop-down
- Enter your PAN number or Application number
- Click on “Submit” to know the allotment status
How To Apply for Firstmeridian Business Services Ltd IPO?
Here are the steps to apply for Firstmeridian Business Services Ltd IPO:
Step 1: Log in to your Kotak Securities Demat account Log in to your Demat account to access IPO investments. Next, select the current IPO section.
Step 2: Specify IPO details Enter the number of lots and the price you wish to apply for.
Step 3: Enter UPI ID After entering your UPI ID, click submit. This will place your bid with the exchange.
Step 4: Mandate Notification Your UPI app will receive a mandate notification to block funds.
Step 5: Approve Request Your funds will be blocked once you approve the mandate request on your UPI.
This article is for informational purposes only and does not constitute financial advice. It is not produced by the desk of the Kotak Securities Research Team, nor is it a report published by the Kotak Securities Research Team. The information presented is compiled from several secondary sources available on the internet and may change over time. Investors should conduct their own research and consult with financial professionals before making any investment decisions. The above images were generated using AI. Read the full disclaimer here.
Investments in securities market are subject to market risks, read all the related documents carefully before investing. Brokerage will not exceed SEBI prescribed limit. The securities are quoted as an example and not as a recommendation. SEBI Registration No-INZ000200137 Member Id NSE-08081; BSE-673; MSE-1024, MCX-56285, NCDEX-1262.
FirstMeridian IPO FAQs
What is the FirstMeridian Business Service Limited?
The FirstMeridian Business Service Limited IPO has an issue size of ₹740 crores. The IPO opens for subscription on TBA and closes on TBA.
Who is the FirstMeridian Business Service Limited ?
Link Intime India Private Limited is the registrar for this IPO.
