Hexaware Technologies is launching an IPO with a book-built issue amounting to Rs 8,750.00 crores. This issue is solely an offer for sale of 12.36 crore shares. The subscription window for Hexaware Technologies IPO opens on February 12, 2025, and closes on February 14, 2025. The finalization of the allotment is anticipated on Monday, February 17, 2025.

The IPO is expected to be listed on both BSE and NSE, with a provisional listing date set for Wednesday, February 19, 2025. The price band for the shares is between ₹674 and ₹708 each.

The minimum application lot size is 21 shares, requiring a retail investment of at least ₹14,154. However, to avoid oversubscription issues, investors are advised to bid at the cutoff price, which totals around ₹14,868. For sNII, the minimum investment is 14 lots (294 shares), costing ₹2,08,152, while bNII requires 68 lots (1,428 shares), totaling ₹10,11,024.

Kotak Mahindra Capital Company Limited, Citigroup Global Markets India Private Limited, J.P. Morgan India Private Limited, HSBC Securities & Capital Markets Pvt Ltd, and IIFL Securities Ltd are the lead managers for this IPO. Kfin Technologies Limited serves as the registrar. For further details, refer to the Hexaware Technologies IPO RHP.

Hexaware Technologies IPO Timeline

• IPO Open Date: February 12, 2025
• IPO Close Date: February 14, 2025
• Listing Date: February 19, 2025
• Total Issue Size: ₹8,750.00 Cr
• Offer For Sale: ₹8,750.00 Cr
• IPO Price Band: ₹674 – ₹708 per share
• Lot Size: 21 shares
• Minimum Investment: ₹14,862 for retail investors
• Issue Type:Book Built Issue IPO

Timeline

IPO Open Date:	February 12, 2025
IPO Close Date:	February 14, 2025
Basis of Allotment:	February 17, 2025
Refunds:	February 18, 2025
Credit to Demat Account:	February 18, 2025
IPO Listing Date:	February 17, 2025

About Hexaware Technologies

Company Overview

Hexaware Technologies is a global IT services and business process outsourcing (BPO) company headquartered in Navi Mumbai, India. Founded in 1990, Hexaware has grown into a significant player in the IT services industry, offering a wide range of services including:

• Application Development and Maintenance: Building, modernizing, and maintaining software applications for clients.
• Digital Services: Cloud computing, data analytics, artificial intelligence, and cybersecurity solutions.
• Business Process Services: Outsourcing of various business functions like customer service, finance, and human resources.
• Enterprise Solutions: Implementing and integrating enterprise software like ERP and CRM systems.

Core Business and Market Position

Hexaware focuses on niche areas within the IT services market, particularly in verticals like banking, financial services, insurance, healthcare, and manufacturing. The company has built a strong reputation for its expertise in areas such as:

• Cloud Computing: Migrating and managing client workloads on cloud platforms like AWS, Azure, and GCP.
• Digital Transformation: Helping businesses leverage digital technologies to improve their operations and customer experiences.
• Automation: Implementing robotic process automation (RPA) and other automation technologies to increase efficiency and reduce costs.

Future Outlook

The IT services industry is constantly evolving, driven by factors like cloud computing, artificial intelligence, and the Internet of Things. Hexaware’s future success will depend on its ability to:

• Adapt to Emerging Technologies: Continuously invest in and develop expertise in new technologies like AI, machine learning, and blockchain.
• Expand its Global Reach: Increase its presence in key markets like North America and Europe.
• Strengthen its Customer Relationships: Build long-term partnerships with clients and deliver high-quality services.
• Attract and Retain Talent: Recruit and retain skilled IT professionals to meet the growing demand for its services.

Challenges

Hexaware faces several challenges in the competitive IT services market, including:

• Competition: The IT services market is highly competitive, with large players like TCS, Infosys, and Wipro vying for market share.
• Pricing Pressure: Clients are increasingly demanding lower prices for IT services, putting pressure on margins.
• Talent Shortages: Finding and retaining skilled IT professionals can be challenging.
• Cybersecurity Threats: The increasing frequency and sophistication of cyberattacks pose a significant risk to businesses.

Overall, Hexaware Technologies is a well-established player in the IT services industry with a strong focus on niche areas and a commitment to innovation. The company’s future success will depend on its ability to navigate the challenges of the evolving market and capitalize on the opportunities presented by emerging technologies.

Objective

The primary objective of the Hexaware Technologies IPO is to provide an exit route for the existing promoter selling shareholder.

Here’s a breakdown:

• Offer for Sale: The IPO is entirely an Offer for Sale (OFS), meaning the company itself will not receive any funds from the issue.
• Promoter Exit: The proceeds from the IPO will go directly to the promoter selling shareholder, allowing them to partially divest their stake in the company.
• Enhanced Visibility: Listing on stock exchanges will increase Hexaware’s brand visibility and market recognition.
• Liquidity for Existing Shareholders: The IPO will provide liquidity for existing shareholders who wish to sell their shares in the open market.

Key Points:

• No Funds for Company: The IPO is not a fundraising exercise for Hexaware Technologies itself.
• Focus on Promoter Exit: The primary goal is to facilitate the promoter’s partial divestment.

Hexaware Technologies : Weighing the Pros and Cons

Pros:

• Strong AI-driven offerings: Hexaware has a strong focus on AI-powered solutions, which is a rapidly growing market with significant potential.
• Diverse customer base: The company serves a wide range of industries, including Fortune 500 companies, which provides revenue stability.
• Profitable business model: Hexaware has a history of consistent profitability and maintains a healthy cash balance.
• Experienced management team: The company has a seasoned management team with a proven track record in the IT services industry.

Cons:

• Offer for Sale (OFS): The IPO is purely an OFS, meaning no fresh capital will be raised for the company’s growth.
• High dependence on North America: A significant portion of Hexaware’s revenue comes from North America, making it susceptible to economic fluctuations in that region.
• Intense competition: The IT services market is highly competitive, with large players like TCS, Infosys, and Wipro posing significant challenges.
• Limited upside potential: The current grey market premium suggests limited listing gains, potentially deterring short-term investors.

So,How Does Hexaware Technologies IPO Fare in Terms of Financials ?

Hexaware Technologies- Financial Data (Restated Consolidated)

Period Ended	Assets	Revenue	Profit After Tax	Net Worth	Reserves and Surplus	Total Borrowing
30 Sep 2024	8,594.2	8,871.3	853.3	4,876	4,816.7	–
31 Dec 2023	7,202.1	10,389.1	997.6	4,230.9	4,171.6	–
30 Sep 2023	7,021.2	7,763.1	804.8	4,294	4,234.7	–
31 Dec 2022	6,514	9,378.8	884.2	3,778.1	3,719.1	82.7
31 Dec 2021	5,673.5	7,244.6	748.8	3,503.7	3,444.8	–

Review:

• Overall Growth: Hexaware has shown consistent growth in assets, revenue, and net worth over the past few years. This indicates a healthy and expanding business.
• Revenue Fluctuation: While revenue has generally increased, there’s some fluctuation between periods. This could be due to various factors, including project cycles and economic conditions.
• Profitability: Profit after tax has also seen growth, although there’s a slight dip in the Sep 2024 period compared to Dec 2023. This warrants further investigation to understand the underlying reasons.
• Debt Reduction: The company seems to have eliminated its total borrowings by the end of 2023, which is a positive sign.
• Reserves and Surplus: The consistent increase in reserves and surplus indicates that the company is reinvesting its profits and strengthening its financial position.

Hexaware Technologies IPO Valuation :

KPI	Values
ROE:	-%
ROCE:	-%
EBITDA Margin:	16.2%
PAT Margin:	9.6%
Debt to equity ratio:	NA
Earning Per Share (EPS):	₹16.45 (Basic)
Price/Earning P/E Ratio:	N/A
Return on Net Worth (RoNW):	23.6%
Net Asset Value (NAV):	₹69.77

SWOT Analysis of Hexaware Technologies IPO

Strengths

• Strong Focus on AI: Hexaware is actively integrating AI across its service offerings, enhancing efficiency and delivering data-driven insights. This positions them well in the rapidly evolving technology landscape.
• Diverse Customer Base: Serving a wide range of industries, including Fortune 500 companies, provides revenue stability and mitigates dependence on any single sector.
• Proven Track Record: Hexaware has a history of consistent profitability and a strong financial performance.
• Global Delivery Model: With a global presence, Hexaware can effectively serve clients across different regions and leverage cost-effective delivery models.
• Experienced Management Team: The company boasts a seasoned leadership team with a proven track record in the IT services industry.

Weaknesses:

• Reliance on North America: A significant portion of Hexaware’s revenue comes from North America, making it susceptible to economic fluctuations in that region.
• Limited Upside Potential (Current IPO): As an Offer for Sale (OFS), the IPO does not raise fresh capital for the company’s growth and expansion. This may limit potential upside for investors.
• Talent Acquisition and Retention: Attracting and retaining skilled IT professionals in a competitive market can be challenging.

Opportunities

• Expanding AI/ML Capabilities: Further developing AI/ML-powered solutions and services can open new revenue streams and enhance competitiveness.
• Geographic Expansion: Exploring new markets and expanding its global footprint can drive growth and diversify revenue sources.
• Cloud Computing Growth: Capitalizing on the growing demand for cloud computing services by offering robust cloud migration and management solutions.
• Strategic Acquisitions: Acquiring smaller companies with niche expertise can accelerate growth and enhance service offerings.

Threats

• Intense Competition: The IT services market is highly competitive, with large players like TCS, Infosys, and Wipro posing significant challenges.
• Economic Downturn: A global economic downturn could impact client IT spending and negatively affect Hexaware’s revenue.
• Cybersecurity Risks: The increasing frequency and sophistication of cyberattacks pose a significant threat to businesses and require robust security measures.
• Currency Fluctuations: Fluctuations in foreign exchange rates can impact profitability, as a significant portion of Hexaware’s revenue is in foreign currencies.

Competitive Analysis: Hexaware Technologies IPO

Key Competitors:

• Tier 1 IT Services Giants:
  • TCS: Largest Indian IT services company, known for its scale and global reach.  
  • Infosys: Strong in digital services, AI, and cloud computing.  
  • Wipro: Diversified portfolio, with a focus on digital transformation and emerging technologies.  
• Mid-Tier IT Services Companies:
  • LTI Mindtree: Known for its digital expertise and strong client relationships.  
  • Coforge: Focuses on niche areas like insurance and banking.
  • Mphasis: Specializes in cloud and cognitive services.  

Competitive Landscape:

• Intense Competition: The IT services market is highly competitive, with established players vying for market share.  
• Pricing Pressure: Clients are increasingly demanding lower prices for IT services, putting pressure on margins for all players.
• Talent War: Attracting and retaining skilled IT professionals is a significant challenge across the industry.
• Focus on Digital: Companies are investing heavily in digital transformation services, including cloud computing, AI, and data analytics.

Hexaware’s Competitive Advantages:

• Niche Focus: Hexaware has carved a niche for itself in specific areas, such as banking, financial services, and insurance.  
• AI/ML Specialization: The company has a strong focus on AI and machine learning, which is a key differentiator in the market.  
• Customer Focus: Hexaware emphasizes building strong client relationships and delivering high-quality services.  

Competitive Disadvantages:

• Revenue Concentration: Significant reliance on North America can expose Hexaware to regional economic fluctuations.
• Smaller Scale: Compared to larger players, Hexaware may have limited resources and a smaller global footprint.

Hexaware Technologies IPO GMP

• Grey market premium as on 12-02-2025 = ₹ 3.5 /Share

Disclaimer:

• IPO Grey Market Premium (Hexaware Technologies IPO GMP) mention is valid for the specific date as mentioned in the header.
• We are not buying and selling IPO forms on IPO Grey Market.
• Don’t decide to subscribe to an IPO just based on the initial price, as it can change before the listing.Subscribe only considering Fundamentals of the companies.

Hexaware Technologies IPO

🔴 Live Subscription Status 🔴

12/02/2025 03:00 PM

	NO OF SHARES OFFERED	Day 1	Day 2	Day 3
Qualified Institutional Buyers(QIBs)	2,56,97,329	0.00
Non Institutional Investors(NIIs)	1,92,72,997	0.01
Retail Individual Investors(RIIs)	4,49,70,327	0.03
Employees	14,82,701	0.09
Total	9,14,23,354	0.02

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