Dev Information Technology share jumps 7% after arm files DRHP for IPO

Dev IT share price rose after its subsidiary, Dev Accelerator Limited (DevX), filed a draft red herring prospectus (DRHP) for an initial public offering (IPO) aimed at expanding its coworking spaces.

Dev IT share price: Dev Information Technology (Dev IT) saw its share price surge by 7.23 per cent, hitting an intraday high of Rs 169.60 per share on Thursday, October 3, 2024.

The increase in Dev IT share price followed the announcement that its subsidiary, Dev Accelerator Limited (DevX), filed a draft red herring prospectus (DRHP) for an initial public offering (IPO) aimed at expanding its coworking spaces.

“We are pleased to announce the filing of the DRHP for our promoted company, DevX. This significant milestone underscores our commitment to the dynamic growth of the flexible work space sector in India. The IPO strategically positions DevX to leverage the increasing demand for flexible office solutions, enabling us to deliver innovative workspace environments tailored to the evolving needs of the clients,” said Pranav Pandya, founder and chairman of Dev Information Technology Limited.

DevX IPO overview

The upcoming DevX IPO includes a fresh issue of up to 2.47 crore equity shares with a face value of Rs 2 each, and the shares will be listed on both the NSE and BSE.

DevX IPO funds usage
 

The funds raised through the IPO will be allocated primarily to enhance the company's infrastructure and financial stability. Specifically, Rs 68.95 crore will be designated for "fit-outs" in new centres and security deposits, ensuring that facilities are well-equipped for operations. 

Additionally, Rs 30 crore will be used for the repayment and/or prepayment of certain borrowings, helping to strengthen the company's balance sheet. 

The remaining proceeds will support various general corporate purposes, including strategic initiatives, marketing enhancements, brand building, lease liabilities, acquiring fixed assets, and overall business development, positioning the company for future growth.

This capital infusion will enable DevX to expand its presence in major cities such as Mumbai, Gurugram, Noida, Pune, Chennai, GIFT City, Ahmedabad, Vadodara, Rajkot, Surat, Goa, and Jaipur. 

As of August 31, 2024, DevX operates 25 centres across more than 10 cities, including Ahmedabad, Vadodara, Hyderabad, Delhi, and Udaipur. The funds from the IPO will strengthen its position as a leading player in the managed office space sector, allowing it to serve a wider range of clients.

“This IPO will not only enhance DevX's operational capabilities but also strengthen its financial stability. By securing additional capital, DevX aims to broaden service offerings and elevate customer experiences. The funds raised will be instrumental in accelerating DevX’s expansion plans, enabling DevX to enter new markets, enhance its infrastructure, and invest in technology that drives efficiency,” said Pandya.

Dev Information Technology Limited, established in 1997 and listed on both the NSE and BSE, has transformed from a small-scale business automation software provider into a global IT services leader.

Headquartered in Ahmedabad, with offices across India and in Canada, the company prioritises continuous innovation, quality, streamlined processes, and technological excellence.

Dev IT offers a comprehensive range of services, including Cloud Services, Digital Transformation, Enterprise Applications, Managed IT Services, and Application Development. Among its product offerings are Talligence, an analytics platform, and ByteSigner, a digital signing solution.

In FY24, the company achieved a revenue of Rs 165.12 crore, an earnings before interest, tax, depreciation and amortisation (Ebitda) of Rs 15.31 crore, and a profit after tax (PAT) of Rs 9.48 crore.