Protean eGov Technologies makes quiet debut, lists at par with issue price

Post listing, the stock moved higher to Rs 823, a premium of 4 per cent over its issue price of Rs 792 per share on the BSE.

Protean eGov Technologies, formerly NSDL e-Governance Infrastructure, made a quiet stock market debut with its shares getting listed at par against its issue price of Rs 792 per share on the BSE on Monday.

Post listing, the stock moved higher to Rs 823, a 4 per cent premium over its issue price. At 10:06 AM, it was quoting at Rs 818, up 3 per cent against the issue price. In comparison, the S&P BSE Sensex was down 0.31 per cent at 65,056.

The initial public offering (IPO) saw nearly 24 times more demand than the shares on offer. The institutional investor portion of the issue was subscribed 47 times, high networth individual portion 32 times, and retail portion close to 9 times. The IPO was entirely a secondary share sale by 360 One Special Opportunities Fund, NSE Investments, SUUTI and a handful of large banks.

Protean eGOV Technologies is an information technology enabled solutions company conceptualizing, developing, and executing nationally critical and population scale Greenfield technology solutions collaborating with the government and has extensive experience in creating digital public infrastructure and developing innovative citizen-centric e-governance solutions.  Some of the key projects implemented by Protean include PAN issuance and enabling the universal social security system.

Protean’s domain knowledge for various industries, enabling policy framework with public and private sector collaboration to foster innovation in NPS and APY subscribers, online pan verifications with significant headroom for steady growth with 50-60mn PAN cards expected to be allotted annually till FY27 and NPS-APY subscribers expected to grow at CAGR of 16-17 per cent (FY22-FY27P) as growth strategy for the coming few years. A secure, scalable and advanced technology platform having horizontal & vertical scalability, with consistent profitability, positive cash flows and limited capital expenditure and working capital required to scale growth in its key areas, Reliance Securities said in IPO note.

However, the company is substantially dependent on projects awarded by government entities and agencies. Revenue from contracts and licenses sourced from government clients/ bodies formed about 72.51 per cent of revenue as at 31st March, 2023. The business is highly IT dependent, said analyst at Sushil Financial Services.

The company had negative cash flow from operations at Q1FY24. The revenue CAGR for the period FY21-23 stood at about 10.93 per cent. The company operated on an EBITDA margin of 15.89 per cent and PAT margin of 14.42 per cent for year ended FY23. Generating an ROE and ROCE of 12.49 per cent and 16.13 per cent respectively for FY23, the brokerage firm said.