HAPPIEST MINDS IPO - Happiest Minds IPO Price & Review.

Initial Public Offering(IPO) - HAPPIEST MINDS IPO. 

Will Happiest Minds IPO make investors happy? 

Talking about the last few IPOs and if you had applied there and if you would have been allotted the shares, you would have made a really good return. As of today, many interested are looking forward to investing in IPOs. They want to invest in every IPO. Now I have got another article for them in which I will be talking about an IPO. which has started its subscription from today and you can apply there. Its name is Happiest Minds. In this article, I will be talking about the Happiest Mind IPO. I will try to explain three things to you in a very simple way. Those three things are what is the business of Happiest Mind? How does the Company perform? 

Other than that, we will talk about the company's financials and at the end of the article, I will inform you about the IPO details which you should know of before applying. Read this article till the end cause if you are planning for other IPOs than the Happiest Mind. I would be informing you at the end of the article on which IPOs are expected to come in the future

Let's start with today's article! and understand the business model of the Happiest Mind.

Friends, Talking about the business of the Happiest Mind, it's divided in the three verticals. Those three verticals are Product Engineering Services, Infrastructure Management Services and Digital business services. Means it operates in the three of these verticals.

If I try to explain their business more simply then.

Now say if I have an offline company with many clients but I want to expand further to the online, cause of which I want an App, Website, etc to be created to improve the reach of my products. If I want to market my products online via these products then Happiest Minds helps in creating it. It provided end to end business service to move from offline to online. Thus three verticals make a company go from offline to online. If you want to move from offline to online, you might need many vendors, cause of this the Happiest Minds have formed these alliances with the vendors from beforehand. The names of these vendors are Amazon Web Services, Microsoft and Salesforce. These are the vendors which helps a business to move online and function well.

EXAMPLE:-

Now as you understood the verticals, you would want to know that if the company is earning Rs 100. How would its division among these verticals look like?

If Happiest Minds gets revenue of Rs 100, 50% of it comes from Digital Businesses. A total of 22% revenue comes from Infrastructure Management Services &The rest of the 23% comes from Product Engineering vertical. From this, you can understand this company's revenue-wise breakup. 

Friends, the customers of the Happiest Mind, till 30th June, this company had more than 140 active customers. If we talk about its revenue geography wise that from which country its revenue is the highest then. Its US, it has more than 75% of its revenue coming from here. Now you know its total number of customers which are more than 140. The thing to focus here as an investor is its dependency on its top 10 customers for its revenue.

Let's talk about this company in financial terms by talking about its Revenue & Profit. 

Happiest Mind reported a Net Profit of Rs 50 Cr in June Qtr. Its sales were around 177 Cr Out of 177 Cr revenue, it earned a Net Profit of Rs 50 Cr in June Qtr, 2020. By this information, you cant figure out on how a company would have performed. Thus let's talk about this company's Net Revenue and Profit in the last 2,3 years to understand its financial situation better. The shocking fact is if we talk about this company's financial year, 2018, it was a loss-making company.

In FY 2018, This company had reported a loss of Rs - 22 Cr. If we talk about FY 2019 then this company had booked a profit of 14 Cr. In the next year, its profit jumped from 14 Cr to almost Rs 77 Cr which means the company have performed well in the last two years. I can see a good result in the recent June Qtr as well. If we talk about the compounded growth in terms of its revenue then it has been of more than 22% in the last few years.

In terms of revenue in FY 2018, its revenue was at around Rs 462 Cr which jumped to Rs 590 Cr in FY 2019. In FY 2020, it came up to Rs 698 Cr, shows you how well its compounded growth has been in the last years in this company's growth. The thing to notice for investors is its 48% of the revenue comes from its top 10 clients which shows its high concentration of revenue among its top 10 clients. It gets an overall 12% revenue from its biggest client cause of which this company's dependency increases heavily on its top customers. 

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Let's talk in detail about the Happiest Minds IPO.

Its price band is from Rs 165 to Rs 166. The minimum no. of lot size that you will need to apply for is 90. If you want to apply for a lot then you might get 90 shares or no shares at all. Talking about the maximum no. of lots, its at 13 which means you cant apply for a lot size of above 13 in the retail category. The IPO date to apply for this IPO is from Sept 7th, 2020 to Sept 9th, 2020. On 14th Sept, you will know if the shares have been allotted to you or not. The tentative Listing date as of Sept 17, 2020, means there are chances the company will start trading from this date on any of the exchange. If we dive into more details then this IP0s Size is of Rs 110 Cr.

IPO DETAILS:- 

Happiest Minds Technologies Limited is coming out with a fresh public issue to raise ₹ 702.02 crores from the market.

Here are some more details regarding the issue:

Issue opens – Sept 7, 2020

Issue closes – Sept 9, 2020

Issue size – ₹ 702.02 crores

Price band – ₹ 165 – 166

Happiest Minds IPO Offer Size by Investor Category

The Percentage of Offer Size available for Allotment/allocation:

QIBs: 75%

Non-Institutional Investors: 15%

Retail Individual Investors: 10%

Strengths Of the company.

1. Focused on software product development

2. Strong Brand in offering Digital IT services

3. End to End digital lifecycle

4. Agile Engineering and Delivery

Company Promoters:

Mr. Ashok Soota is the promoter of the company.

Company Financials:

Summary of financial Information (Restated)

Particulars	For the year/period ended (₹ in Million)
	30-Jun-20	31-Mar-20	31-Mar-19	31-Mar-18
Total Assets	5,730.8	5,081.5	4,135.2	3,869.9
Total Revenue	1,869.9	7,142.3	6,018.1	4,891.2
Profit After Tax	501.8	717.1	142.1	(224.7)

The company proposes to utilise the Net Proceeds from the fresh issue towards funding the following objects: Objects of the Issue:

1. To meet long term working capital requirement; and

2. General corporate purposes

Happiest Minds IPO Tentative Date / Timetable

Bid/Offer Opens On	Sep 7, 2020
Bid/Offer Closes On	Sep 9, 2020
Finalisation of Basis of Allotment	Sep 14, 2020
Initiation of Refunds	Sep 15, 2020
Credit of Shares to Demat Acct	Sep 15, 2020
IPO Shares Listing Date	Sep 17, 2020

Happiest Minds IPO Lot Size and Price (Retail)

Application	Lots	Shares	Amount (Cut-off)
Minimum	1	90	₹14,940
Maximum	13	1170	₹194,220

Happiest Minds IPO Promoter Holding

Pre Issue Share Holding  61.77%

Post Issue Share Holding 53.25%

Risks to Investors in Happiest Minds IPO

1. The two book running lead managers associated with the Offer have handled 11 public issues in the past three years out of which 5 closed below the issue price on the listing date.
2. The average cost of acquisition for the Promoter Selling Shareholder is ₹34.68 and the Investor Selling Shareholder is ₹24.91, and the offer price at the upper end of the price band is 166.
3. The PE ratio based on diluted EPS for Fiscal 2020 for the Issuer at the upper end of the Price Band is as high as 31.0 as compared to the average industry peer group PE ratio of 26.9.

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Another interesting fact here is this company is going to offer for sale after IPO. Its size is around Rs 702 Cr. You would want to know the difference between these two. IPO stands for Initial Public Offering, Company brings in new shares to the market. The money which they receive here goes directly to the company, not to any of its promoters. Here if we talk about an Offer for sale which is of more than Rs 700 Cr. It is done so that any promotor can sell his shares off and cash out. Now say its founder offers its shares at Offer For Sale, other than that any big company which wants to exit by selling its shares can take up this offer for share and exit from the company. These were some basic information about the Happiest Mind using which you can decide whether to invest this IPO or not.

Now let's go to the last part of the article cause of which I asked you to read the article till the very end. I will tell you now on which are the two or three IPOs which can come after the Happiest Minds IPO. The IPOs which can come after the Happiest Mind IPO are CAMS, a mutual fund transfer agency. CAMS full form is Computer Age Management Services. Its IPO can be expected very soon. After CAMS, the Ipos to expect are Routemobile, Glad Pharma Limited, and Kalyan Jewellers. These IPOs are in the pipeline as of now. They can be expected very soon after this.

UPCOMING IPO:- 

Route Mobile Limited is coming out with a fresh public issue to raise ₹ 600 crores from the market.

Here are some more details regarding the issue:

Issue opens – Sept 9, 2020

Issue closes – Sept 11, 2020

Issue size – ₹ 600 crores

Price band – ₹ 345 – 350

Lot Size - 40 shares 

Face Value - Rs 10

I hope you would have liked this Article!

In the end, I would like to give a disclaimer that all our article are purely on educational purposes. Only publish educational content with no recommendation to buy or sell. Friends, if you are liking this company, you might apply for its IPO. If you planning on making a profit from it in the short term and getting out of it, then it can be a wrong strategy. Always have a long term perspective in mind. If you invest in the long term in mind your chances of profit might increase.

If you liked this article, comment below! and tell us whether you should be investing in the Happiest Mind IPO or not. Other than that, if you have not subscribed to Dev’s Invest Notes- Blogosphere, Subscribe it! cause we add three to four articles here which can help you be a good investor. 

Happy Investing!

 THANK YOU!

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