Nasdaq-listed Ebix Inc’s Indian subsidiary EbixCash has filed draft papers for an initial public offering (IPO) of Rs 6,000 crore ($785 million) with markets regulator Securities and Exchange Board of India (SEBI).
VCCircle had in February reported that the company was looking to file its draft papers for IPO to raise as much as Rs 7,500 crore (around $1 billion).
It was also eyeing for a valuation of Rs 37,500 crore (around $5 billion), VCCirlce had reported.
According to EbixCash’s draft red herring prospectus (DRHP), the IPO will include equity shares of face value of Rs 1 each, which is a complete fresh issue of shares and the entire proceeds will go to the company.
The offer will also include a reservation for subscription by eligible employees, the draft papers added.
Moreover, the company may look to further issue equity shares including a rights issue aggregating up to Rs 1,200 crore, in consultation with its lead bankers, the company said.
It added that it may reduce the size of the fresh issue in case it goes decides to go with such a placement.
Motilal Oswal Investment Advisors Ltd, Equirus Capital Pvt Ltd, ICICI Securities Ltd, SBI Capital Markets Ltd and Yes Securities (India) Ltd are the book running lead managers for the issue, and Link Intime is the registrar, the company said.
The company plans to use the issue proceeds to the tune of Rs 1,035.03 crore for working capital requirements of its subsidiaries, Rs 2,747.57 crore for purchase of outstanding convertible debentures from its subsidiaries and funding strategic acquisitions and investments besides general corporate proposes, it said.
EbixCash claims to be a market leader in international remittance based on Gross Transaction Value (GTV) and foreign exchange and said it has an increasing exposure to digital payments, domestic money remittances, pre-paid cards, travel, insurance, and corporate and incentive solutions.
In October 2020, EbixCash acquired AssureEdge Global Services Pvt Ltd and rebranded it as EbixCash Global BPO services.
AssureEdge Global had 800 employees at the time of acquisition and currently, it has more than 2,850 employees, EbixCash said, adding that the company has 21 clients and is profitable now.
EbixCash, meanwhile, clocked a profit of Rs 230.05 crore in 2020-21 (FY21), against a profit of Rs 243.34 in the previous year. The company cited of Covid-19 as a reason for the fall in its profit for the year. However, the company reported a strong rise in its revenues for the year. EbixCash’s profit rose 91.36% to Rs 4,152.23 crore in FY21 from Rs 2,170.02 crore in 2019-20 (FY20), primarily due to growth in its forex, remittances and payments business segments, the company said.
EbixCash said it was the most profitable in revenues, followed by One97 Communications Ltd, parent of Paytm, and MakeMyTrip, when compared with competitors in FY21.
The company further said the increase in its revenues was mostly due to a shift in product focus, with the company focusing more on the prepaid cards segment.
EbixCash clocked a profit of Rs 191.10 crore for the six-month period ended September 2021 on revenues of Rs 2,653.42 crore.
For the same period in 2020-21, the company had clocked revenues of Rs 1,480.83 crore. The company attributed the sharp rise in its revenues to the surge in payment solutions and financial technology business segment, which, EbixCash said accounts for 77.73% and 19.46% respectively, of its topline.
