Hexaware Technologies Ltd IPO

About Hexaware Technologies Limited IPO

Hexaware Technologies Limited IPO is an IPO of ₹8750 crores. It consists of an offer for sale aggregating up to ₹8750 crores by the promoter, CA Magnum Holdings. The shares will be allotted on Feb 17, 2025. The credit of shares to the demat account and the initiation of refunds will also occur on Feb 18, 2025.

Objective of Hexaware Technologies Limited IPO

• Listing the Equity Shares on stock exchanges aims to improve the company's visibility and strengthen its brand presence in the market.
  
• The listing will offer liquidity to existing shareholders by creating a public market for the Equity Shares in India.
  
• The company will not receive any proceeds from the offer. Instead, all proceeds from the sale of equity shares will go to the Promoter Selling Shareholder in proportion to their offered shares.
  

Industry Outlook

The global IT and business process services (IT-BP) industry is undergoing significant transformation, primarily driven by rapid advancements in digital technologies, increasing adoption of cloud computing, and the growing demand for artificial intelligence (AI) solutions. According to the Everest Group report, which forms the basis of Hexaware’s industry analysis, the global outsourced IT-BP services market grew at a compound annual growth rate (CAGR) of 7.3% from 2021 to 2023. In comparison, Hexaware outpaced this growth with a CAGR of 13.7% during the same period, reflecting its competitive positioning and operational excellence.

Hexaware operates in an increasingly competitive landscape characterized by a mix of large-scale providers, mid-sized agile players, and niche digital disruptors. While larger firms dominate in terms of resources and breadth of services, mid-sized providers like Hexaware excel in agility and sector-specific expertise. Emerging opportunities in data analytics, cloud migration, and AI-driven automation, combined with Hexaware's domain expertise, position the company to capitalise on the accelerating global digital transformation.

Company Information

Hexaware Technologies Limited was incorporated on November 20, 1992, under the name “Aptech Information Systems Limited” as a public limited company under the Companies Act, 1956. The company received its certificate of commencement of business on December 31, 1992.

Hexaware specialises in providing IT services, including application development, enterprise solutions, and business process outsourcing. It has been recognised for its emphasis on innovation, customer-centricity, and leveraging advanced technologies to meet the dynamic needs of its clients. They serve customers across the Americas, Europe and Asia-Pacific (including India And Middle East) (APAC). With a diverse portfolio, Hexaware serves sectors such as Financial Services, Healthcare and Insurance, Manufacturing and Consumer, Hi-Tech and Professional Services, Banking, and Travel and Transportation.

Risks of Hexaware Technologies Limited IPO

• Hexaware derives 73.3% of its revenue from the Americas and 20.5% from Europe. Adverse economic conditions in these geographies could impact client budgets and IT spending.

• A significant portion of Hexaware's revenues is earned in foreign currencies, while expenses are incurred in Indian Rupees. Currency fluctuations pose a substantial risk to profitability despite existing hedging strategies.

• The IT services market is highly competitive. Larger firms with extensive resources often push for aggressive pricing, encouraging clients to consolidate their vendor base, potentially threatening Hexaware’s contracts.

Anchor Investor bidding date:

The anchor investor bidding will take place one day before the IPO opens, which is Feb 11, 2025.

IPO Registrar and Book Running Lead Managers:

Book running lead managers:

• Kotak Mahindra Capital Company Limited
• Citigroup Global Markets India Private Limited
• J.P. Morgan India Private Limited
• HSBC Securities and Capital Markets (India) Private Limited
• IIFL Securities Limited

Name of the registrar: Kfin Technologies Limited

Business Model:

Hexaware operates a global IT services model, leveraging cutting-edge technology and innovation to deliver business solutions across multiple industries.

• Key aspects of their business model include AI-led analytics for customer insights, predictive maintenance, and operational enhancements; development and modernisation of core business systems such as booking, reservations, cargo management, and route planning; legacy application and data landscape modernisation services; and integration services with third-party platforms.

• The company offers time-and-material contracts, where charges are based on employee engagement time, and fixed-price contracts, which involve pre-determined pricing based on project milestones.

• Hexaware operates 38 delivery centres supported by 16 offices spread across 28 countries and utilises an onshore-offshore mix for efficient service delivery.

Company Growth Trajectory:

• Revenue from operations grew at a CAGR of 22.8% between FY2021 and 9MFY25.
  
• The revenue base has been diversified across various geographies and industries, which strengthens the company's growth potential and reduces dependency on any single market or sector.
  
• Adjusted EBITDA margin rose from 15.9% in FY2022 to 15.8% in the third quarter of FY25.
  

Company Market Position:

• Dominates the Americas and Europe, with 73.3% and 20.5% of revenue, respectively.
  
• Positioned as a mid-sized, agile provider excelling in AI, cloud transformation, and industry-specific innovations.
  
• Recognised for its “Land, Ramp, and Expand” strategy to deepen customer relationships.
  
• Collaborates with technology leaders like Google Cloud, AWS, and Microsoft Azure to integrate advanced AI solutions.
  

How to check Allotment Status of Hexaware Technologies 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 Kfin Technologies 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 Hexaware Technologies 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 Kfin Technologies Limited website
• Choose “Public Issues” from the “Investor Services” drop-down
• Select Hexaware Technologies from the drop-down
• Enter your PAN number or Application number
• Click on “Submit” to know the allotment status