Hexaware Technologies, a leading digital and technology services company backed by private equity giant Carlyle Group, is gearing up for one of the largest IPOs in recent history. The company has filed a Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI), seeking to raise Rs 9,950 crore through an Offer for Sale (OFS). This massive public issue stands as the largest IPO in India’s IT sector since Tata Consultancy Services’ Rs 4,700 crore listing two decades ago.
The IPO is solely an OFS, meaning that all proceeds will go to the selling shareholder, CA Magnum Holdings, which holds a 95.03% stake in Hexaware. This decision is part of the company’s strategy to list its equity shares and provide liquidity for its shareholder. Notably, Hexaware’s public offering does not aim to raise new capital for the company itself, but rather to allow the promoter to divest its stake.
Founded in 1990, Hexaware has evolved into a global leader in IT services, offering solutions in cloud computing, artificial intelligence, automation, and digital transformation. With a strong presence across 28 countries and 31,870 employees, the company serves an impressive client roster, including 31 of the Fortune 500 companies. Their services span across key industries such as financial services, healthcare, insurance, manufacturing, and more.
For the fiscal year ending in 2023, Hexaware reported revenues of Rs 10,380 crore, with a net profit of Rs 997 crore. As of June 2024, the company has already achieved revenues of Rs 5,684 crore, signaling a strong performance for the year ahead.
The Carlyle Group, which took control of Hexaware after its previous promoter Baring Private Equity Asia delisted the company in 2020, is now looking to capitalize on the company’s growth through this IPO. In addition to raising funds for CA Magnum Holdings, this IPO will allow Hexaware to strengthen its market visibility and position itself as a leader in the highly competitive IT services sector.
The equity shares are proposed to be listed on both the BSE and NSE, with major financial institutions like Kotak Mahindra Capital, Citigroup, JP Morgan, and IIFL Securities acting as the lead managers for the offering.
Summary:
1. Hexaware Technologies has filed for a Rs 9,950 crore IPO, the largest in India’s IT sector in over two decades.
2. The IPO is an Offer for Sale (OFS) by CA Magnum Holdings, with no fresh issue of shares.
3. Hexaware reported revenues of Rs 10,380 crore in 2023, with clients including 31 Fortune 500 companies.
4. The equity shares will be listed on both BSE and NSE.
