KFin tech files draft papers for ₹2,400 cr IPO: Key highlights

KFIN Technologies, the leading technology-driven platform for financial services, has submitted a draft red herring prospectus (DRHP) to the market regulator to launch its IPO on SEK 2,400 million.

The IPO is entirely an offer for sale (OFS) where the shareholder General Atlantic Singapore Fund will take off contributions to a level of SEK 2,400 million.

Kotak Mahindra Bank, ICICI Securities, Jefferies, JP Morgan and IIFL Securities are the main responsible parties for the issue.

The purpose of the offer is to implement the offer to sell shares of General Atlantic; achieve the benefits of listing the shares on the stock exchanges. KFin will not receive any income from this listing, as such income will go to General Atlantic.

The nominal value of the shares offered in the IPO is 10 pieces. However, details such as price range, the reserved part for the investor category, the issue period and the number of shares will be offered to be announced in due course. Following the IPO, it is proposed that the shares be listed on BSE and NSE.

KFin Technologies is a leading technology-driven financial services platform that provides comprehensive services and solutions to capital market ecosystems including asset managers and corporate asset class issuers in India and provides several investor solutions including fundraising and processing for mutual funds and private pension systems in Malaysia, the Philippines and Hong Kong.

On January 31, 2022, the company emerged as the country’s largest provider of investor solutions to Indian funds, based on the number of AMC customers served. The company currently provides services to 25 of 42 AMC in India, representing 60% of the market share based on the number of AMC customers. The company’s services are 270 funds of 157 asset managers in India as of January 31, 2022, which corresponds to a 32% market share based on the number of AIF funds served.

The company’s history of profitable growth is reflected in its profit for the period / year, gross profit and EBITDA development in recent years.

KFIN’s revenues grew to a CAGR of 4.42% between the financial year 2019, on a pro forma basis, and the financial year 2021. Furthermore, its gross profit grew by a CAGR of 15.09%, between the financial year 2019, on a pro forma basis, and the financial year 2021. during the same period increased operating EBITDA with a CAGR of 21.70%. At the same time, the gross margin increased from 48.73% during the 2019 financial year, on a pro forma basis, to 59.20% during the financial year 2021, while the operating margin for EBITDA increased from 30.25% during the 2019 financial year, on a pro forma basis, to 41.09% in revenue, increased with 202% of revenue. mix, operational leverage, adoption of our platform as a service model, higher subscriptions to VAS, optimization of our number of employees, improved staff productivity and continuous operational optimization thanks to our integrated technology stack as we have benefited from scale efficiencies.

Among its many strategies in the future, KFIN intends to continue to increase the total share of revenues from the sale of these services to existing and new customers. The company implements marketing and sales initiatives across its entire platform to target new customers and expand its customer base. The company is expanding its operations in Malaysia and Hong Kong, with acquisitions of 10 customers until December 31, 2021. In addition, the company has signed three AMCs in Malaysia and Singapore that are not yet operational. Furthermore, the company plans to deepen its presence in Southeast Asia and has expanded its international sales team by adding additional country sales in Southeast Asia.

In domestic fund solutions, the company plans to benefit from its differentiated technology combined with a platform strategy and a depth of value-added products that are key elements in the new customer acquisition strategy. In issuer solutions, the company intends to continue to focus on sales efforts at the back of a track record of execution and delivery as well as various value-creating products. Furthermore, KFin plans to utilize the availability of talent in India and existing financial technological opportunities to deliver the next generation of services in such markets in the future.

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