Stellar Debut! Unicommerce eSolutions shares list at ₹235, a 117.59% premium to IPO price

Shares of Unicommerce eSolutions made a stellar debut on the exchanges today, August 13. The stock listed at ₹235 per share on the NSE, a premium of 117.59 percent to its issue price of ₹108. Meanwhile, on BSE, it listed at ₹230, a 112.96 percent premium.

The ₹276.57 crore initial public offering (IPO) was open for subscription between August 6-8 at a price band of ₹102-108 per share.

The issue witnessed phenomenal demand in its 3 days of bidding. The IPO was overall subscribed 168.35 times with investors bidding for 237.11 crore shares as against 1.4 crore on offer. The Non Institutional Investors category was subscribed the most 252.46 times followed by the Qualified Institutional Buyers quota, which was bid 138.75 times. Meanwhile, the Retail Investor portion was also subscribed a massive 130.99 times.

The initial public offering (IPO) of Unicommerce eSolutions consists entirely of an Offer for Sale (OFS), involving up to 2.56 crore shares with a face value of Re 1 per share. Through this OFS, AceVector Ltd and SB Investment Holdings (UK) aim to divest part of their stakes in the company. Consequently, Unicommerce eSolutions will not receive any proceeds from the IPO since it is solely an OFS transaction.

The allocation of shares in the IPO is structured to reserve approximately 75% for qualified institutional buyers, 10% for retail investors, and the remaining 15% for non-retail investors. The book-running lead managers for the IPO are IIFL Securities and CLSA India, with Link Intime India serving as the registrar.

About the firm

Founded in February 2012, Unicommerce eSolutions operates as a Software as a Service (SaaS) platform, offering solutions to manage e-commerce operations for brands, sellers, and logistics providers. The company provides a suite of software products designed to streamline post-purchase e-commerce processes. It serves a significant and expanding client base in India, including well-known names such as Lenskart, Fabindia, Zivame, TCNS, Mamaearth, Emami, Sugar, BoAt, Portronics, Pharmeasy, GNC, Cello, Urban Company, Mensa, Shiprocket, Xpressbees, and others.

In addition to its presence in India, Unicommerce has clients in six other countries, with a focus on regions in South East Asia and the Middle East. For the fiscal year ending March 31, 2024, Unicommerce reported a net profit of ₹13.08 crore, an increase from ₹6.48 crore the previous year. The company's revenue for FY24 was ₹109.43 crore, up from ₹92.97 crore in the prior fiscal year.

Analysts have suggested that aggressive investors might consider subscribing to the IPO for potential listing gains, given that the issue is priced at a premium. However, Swastika Investmart noted that the IPO is priced aggressively with a Price-to-Earnings (P/E) ratio of 84x, reflecting a premium valuation. In the absence of listed peers, making a comprehensive valuation comparison is challenging. Due to these factors, they recommend a cautious approach, suggesting that only well-informed investors should consider this IPO for potential listing gains. They have given a 'Subscribe with caution' rating for the IPO.