₹8,750 Cr Hexaware IPO: Detailed Look at Issue Price, GMP, Financials & SWOT

Hexaware Technologies Ltd is set to enter the stock market with its much-anticipated ₹8,750 crore initial public offering (IPO). Backed by private equity giant Carlyle Group, this IPO isn’t just another public issue—it’s the biggest offering in India’s IT services sector since Tata Consultancy Services’ ₹4,700 crore IPO over two decades ago.

The excitement is already building, with shares trading at a premium in the grey market, signaling strong investor interest. With a solid track record and a growing global presence, Hexaware’s IPO is one to watch. Let’s look into the details and see what it has to offer.

IPO Details 

The issue is entirely an offer for the sale of 12.36 crore shares. The IPO of Hexaware Technologies will open for public subscription on Wednesday, February 12, and conclude on Friday, February 14. 

Offer Price	₹674 to ₹708 per share
Face Value	₹1 per share
Opening Date	12 February 2025
Closing Date	14 February 2025
Total Issue Size (in Shares)	12,35,87,570
Total Issue Size (in ₹)	₹8,750.00 Cr
Issue Type	Book Built Issue IPO
Lot Size	21 Shares
Listing at	BSE, NSE

The bidding for anchor investors will open for a day on Tuesday, February 11, as per the company’s announcement. The company has been valued at over Rs 43,000 crore at the upper end of the price band. The initial share sale of the Mumbai-headquartered company is a complete Offer-for-Sale (OFS) of Rs 8,750 crore by promoter CA Magnum Holdings, part of Carlyle Group. The minimum lot size for an application is 21 shares. 

Allocation of Shares

Investors can bid for a minimum of 21 shares and in multiples thereafter. Below are the investment requirements for different categories: 

Investor Category	Lots	Shares	Investment Amount
Retail (Min)	1	21	₹14,868
Retail (Max)	13	273	₹1,93,284
S-HNI (Min)	14	294	₹2,08,152
S-HNI (Max)	67	1,407	₹9,96,156
B-HNI (Min)	68	1,428	₹10,11,024

• 50% of the issue size is reserved for Qualified Institutional Buyers (QIBs).
• 35% is reserved for Retail Investors.
• 15% is reserved for Non-Institutional Investors (HNIs).

GMP (Grey Market Premium) Update

In the grey market, Hexaware Technologies’ shares are trading at a premium of ₹11. Given the IPO price band of ₹708, the expected listing price is ₹719, reflecting a potential 1.55% gain. GMP fluctuations indicate investor sentiment but do not guarantee actual listing performance.

Company Overview

Hexaware Technologies is a global digital and technology services company with artificial intelligence (AI) at its core. It serves a diverse range of customers, including 31 Fortune 500 organizations, spanning the Americas, Europe, and Asia-Pacific (including India and the Middle East). 

The company operates through six business segments: financial services, healthcare and insurance, manufacturing and consumer, hi-tech and professional services, banking, travel, and transportation. Its IT service offerings cover five broad areas: Design and build, Secure and run, Data and AI, Optimize, and Cloud Services. The company delivers services through AI-enabled digital platforms, such as Rapid for digital transformation, Tensai for AI-powered automation, and Amaze for cloud adoption.

Hexaware’s previous promoter, Baring Private Equity Asia, delisted the company in 2020. Nearly a year after the delisting, Carlyle Group acquired Baring Private Equity Asia’s stake in October 2021. For the nine months ended September 2024, the company’s net profit stood at Rs 853.3 crore, with revenues at Rs 8,820 crore. The company has reserved half of the issue size for qualified institutional buyers, 35% for retail investors, and 15% for non-institutional investors.

Financial Strength

Hexaware Technologies Limited has shown consistent financial growth, increasing assets, revenue, and profitability. As of September 30, 2024, the company’s total assets stood at ₹8,594.2 crore, significantly rising from ₹7,202.1 crore in December 2023 and ₹5,673.5 crore in December 2021.

Revenue has also seen a steady increase, reaching ₹8,871.3 crore for the first nine months of 2024, following ₹10,389.1 crore in FY23, ₹9,378.8 crore in FY22, and ₹7,244.6 crore in FY21. The company’s profit after tax (PAT) stood at ₹853.3 crore as of September 2024, compared to ₹997.6 crore in FY23 and ₹884.2 crore in FY22, reflecting stable profitability. The company has demonstrated strong financial health and consistent expansion, positioning itself well for future growth.

SWOT Analysis

STRENGTHS	WEAKNESSES
Established IT player with global clientele, including 31 Fortune 500 companies. Strong financial performance with consistent revenue and profit growth. AI-driven service offerings position it as an industry innovator. Diverse industry presence across BFSI, Healthcare, Manufacturing, and more.	High dependence on large clients could impact revenue if key clients leave. Limited IPO proceeds for expansion since this is an Offer for Sale (OFS).
OPPORTUNITIES	THREATS
Growing demand for AI-driven IT services in digital transformation and cloud computing. Expansion in untapped global markets, including emerging economies. Increased IT spending by enterprises, boosting demand for Hexaware’s solutions.	Intense competition from major IT firms like TCS, Infosys, and Wipro. Global economic uncertainty affecting IT budgets and outsourcing demand. Regulatory challenges and cybersecurity risks in digital transformation projects.

Conclusion

In conclusion, Hexaware Technologies’ ₹8,750 crore IPO represents a significant milestone in India’s IT services sector. With a strong financial track record, cutting-edge AI-driven services, and a broad global presence, Hexaware may be poised for promising growth in the rapidly evolving tech landscape.

However, potential investors must consider the risks, including reliance on large clients and the competitive nature of the industry. Despite these challenges, the IPO’s strong grey market premium and strategic positioning suggest that Hexaware’s public debut is one to watch closely. As the company continues to innovate and expand, its IPO could be a key opportunity for investors seeking exposure to the booming IT services sector.

Other IPO Resources: IPO | Current IPO | Upcoming IPO | Listed IPO

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