Seshaasai Technologies IPO opens today: GMP at 21%, should you subscribe?

The initial public offering (IPO) of Seshaasai Technologies is set to open for public subscription today, September 23. The ₹813.07-crore issue comprises a mix of fresh issue and an offer for sale. The IPO will remain open for public bidding till September 25.

Seshaasai Tech IPO: What brokerages say

SBI Securities: Not rated

The brokerage said that Seshaasai Technologies is among the top two payment card manufacturers in India, with a market share of 31.9% (as of FY25) in credit and debit card issuance.

At the upper price band, the company is valued at a P/E multiple of 30.8x based on FY25 earnings on a post-issue basis, according to SBI Securities, which has not assigned a rating to this IPO.

Anand Rathi: Subscribe for long term

Anand Rathi mentioned that the company seeks to enhance per-customer contributions by offering a broader, customised portfolio of solutions in close collaboration with clients. It also plans to expand internationally, targeting the SAARC region, parts of Africa, and Eastern Europe.

Taking these factors into account, Anand Rathi said the IPO appears fully priced but merits a 'subscribe - long term' recommendation.

Key things to know about Seshaasai Tech IPO

Payment solutions provider Seshaasai Technologies moved to the capital markets to raise funds through a fresh issue of shares worth ₹480 crore and an offer for sale of shares worth ₹333 crore, at a price band of ₹402-423 per share.

Investors can bid for a minimum of 35 shares, requiring an investment of ₹14,805 at the upper price band, and in multiples thereafter.

Seshaasai Tech IPO GMP

In the unlisted market, shares of the company are trading with nearly 21% grey market premium (GMP) over the IPO price.

However, it is important to note that grey market premiums are just an indicator of how the company's shares are stacked up in the unlisted market and are subject to change rapidly.

Anchor book details

Seshaasai Technologies has garnered ₹243.32 crore from anchor investors ahead of its IPO opening. The company informed the bourses that it allocated 57.52 lakh equity shares at ₹423 per share to anchor investors.

Some of the marquee institutions that participated in the anchor include Nippon Life Mutual Fund, ICICI Prudential MF, Valuequest India Inflexion Fund, Tata AIG General Insurance Company, UTI MF, Motilal Oswal MF, Sundaram MF, HSBC MF, DSP MF, HSBC Global Investment Funds, Franklin India MF, Edelweiss MF and Axis Max Life Insurance.

Seshaasai Tech IPO objective

Seshaasai Tech that is valued at ₹6,844 crore plans to utilise ₹197.9 crore of fresh issue proceeds for its expansion of existing manufacturing units, and ₹300 crore for repaying debt. The remaining fresh issue funds will be set aside for general corporate purposes.

Company description

Seshaasai Technologies is a technology driven multi-location solutions provider focused on offering payments solutions, and communication and fulfilment solutions catering primarily to the BFSI industry. STL's solutions are driven by its proprietary platforms, which allow the company to offer solutions at scale and on a recurring basis.

Additionally, STL also offers Internet of Things (IoT) solutions to a wide set of customers across industries.

Book running lead managers

IIFL Capital Services, ICICI Securities, and SBI Capital Markets are the book running lead managers for the Seshaasai Technologies IPO, and MUFG Intime India is the registrar.

The allotment for the Seshaasai Technologies IPO is expected to be finalised on September 26, and the IPO will be listing on BSE and NSE with a tentative listing date fixed as September 30.