Micropro Software Solutions LTD. IPO - Review, Valuation & GMP

Micropro Software Solutions Limited - Complete Overview

Established in 1998, Micropro Software Solutions Limited is a well-established IT service company specializing in Software Development, Data Processing, and Software Training. 
The company holds ISO 90001:2015 certification and is dedicated to crafting software solutions for a wide range of industries. Notably, the company does not delegate its services to third-party vendors when serving customers.

With a proficient tech team comprising more than 150 professionals, Micropro Software Solutions caters to over 4,000 clients across regions including India, the USA, UAE, and Africa. Their client portfolio extends to government entities, PSUs, and corporate clients.

The company offers a comprehensive suite of services encompassing:

• IT Infrastructure Management Services.
• Server Management.
• Virtualization Services.
• Storage and Backup Management.
• Network Management.
• Security Management.
• Database Management.
• Middleware Administration.
• Data Centre Operations Management.

 

What does the company do?

Micropro Software Solutions Limited operates as an IT service company with a focus on Software Development, Data Processing, and Software Training.

 

IPO Overview 

Micropro Software Solutions IPO date is slated to be open for subscription from November 3, 2023, to November 7, 2023. This SME IPO follows a Fixed Price Issue format.

The Micropro Software Solutions IPO price is fixed at Rs. 81 per share. The upcoming SME IPO is anticipated to be listed on November 16, 2023.

The total issue size of this IPO amounts to Rs. 30.70 Crores. Within this total issue, 50% is allocated for other investors, while the remaining 50% is earmarked for retail investors.

 

Micropro Software Solutions Limited IPO timetable (Tentative)

Events	Date
IPO Opening Date	3 November 2023
IPO Closing Date	7 November 2023
IPO Allotment Date	10 November 2023
Refund initiation	13 November 2023
IPO Listing Date	16 November 2023

 

Micropro Software Solutions Limited IPO Details 

IPO Opening & Closing Date	3 November to 7 November 2023
Face value	Rs. 10 per Share
Issue Price	Rs. 81 per Share
Lot Size	1600 Shares
Price of 1 lot	Rs. 129,600
Issue Size	3,790,400 Shares (aggregating up to Rs. 30.70 Cr)
Offer for Sale	NA
Fresh issue	3,790,400 Shares (aggregating up to Rs. 30.70 Cr)
Listing at	NSE SME
Issue Type	Fixed Price Issue IPO
Registrar	Purva Sharegistry India Pvt. Ltd.

 

Micropro Software Solutions Limited IPO Lot Details 

Minimum Lot Investment (Retail)	1 Lot
Maximum Lot Investment (Retail)	1 Lot
Minimum Lot Investment (HNI)	2 Lot

 

 

Micropro Software Solutions Limited IPO Reservation

Other Investors Share Portion	50%
Retail Investors Share Portion	50%

 

Company Financial

Amount in Lakhs

Period	31 Mar 2023	31 Mar 2022	31 Mar 2021
Total Assets	2,559.57	2,048.58	1,547.57
Total Revenue	2,217.20	1,755.17	1,392.48
PAT	592.23	267.14	129.51
Net worth	1,648.21	1,055.98	788.84
Reserve & Surplus	1,623.21	1,030.98	763.84
Total Borrowings	397.97	592.05	437.81

 

Geography-wise Revenue Bifurcation

(Amount in Lakhs)

Particulars of Geography	FY 23	FY 22	FY 21
Revenue from Indian Operations
India	1,637.55	1,253.49	1121.19
Other Countries	303.30	12.39	7.75
Revenue from Overseas Operations
UAE	264.68	477.78	259.10

 

Product-wise Revenue Bifurcation

(Amount in Lakhs)

Products or Services	FY 23	FY 22	FY 21
Sale of Products
Software	272.06	268.29	205.10
Hardware	229.34	347.70	327.65
Sale of Services
Software Development	587.62	291.38	250.59
Maintenance & Support Services	1,104.62	823.96	604.71
Other Operating Revenue
Commission	11.89	12.31	-

 

Objective of the Issue 

The company intends to use the net proceeds for the following objectives:

• Meeting working capital needs.
• Supporting capital expenditure requirements.
• Addressing general corporate objectives.

 

Promoters and Management of Micropro Software Solutions Limited

Mr Hitesh Dhirajlal Parikh, Mr Sanjay Yadavrao Mokashi, Mr Prashant Renukadas Rajurkar, Mrs Shefali Hitesh Parikh, Mrs Meenakshi Sanjay Mokashi and Mrs Swati Prashant Rajurkar are the current Promoters of the Company.

Pre-issue Promoter Shareholding	63.40%
Post-issue Promoter Shareholding	46.59%

 

Peer Comparison

Below are the listed peers of Micropro Software Solutions Limited

Company Name	EPS	P/E	Revenue from operations for Financial Year 2023 (Rs. in Lakhs)
Micropro Software Solutions Limited	5.78	0.34	2,205.53
Softtech Engineers Limited	5.48	26.12	6534.09
Compucom Software Limited	0.63	29.43	5,462.27
Persistent Systems Limited	120.52	37.25	8,35,059.20

 

IPO's Valuations

To evaluate the IPO's valuation, we can utilise the information presented in the company's DRHP. Micropro Software Solutions IPO price is set at Rs. 81 per share, with an EPS of Rs. 5.78. Based on the issue price the company's P/E ratio is calculated at 14.01.

 

Dividend Policy

According to Micropro Software Solutions IPO DRHP, the company did not distribute dividends in the preceding fiscal years, and its capacity to declare dividends in the future hinges on its earnings and financial health.

 

IPO's Strengths

• Established client relationships that have endured over time.
• Proven history of financial success and continual expansion.
• Seasoned leadership in the Board and Senior Management roles.

 

IPO Weaknesses 

• The company could potentially encounter claims of intellectual property infringement from other firms.
• The company confronts competition in its industry.
• The company's revenues, expenses, and profitability may experience substantial fluctuations, making predictions challenging.
• The duration of the company's sales cycle may vary significantly, influenced by external factors that can lead to notable revenue fluctuations.
• To maintain competitiveness, the company may need to revise its pricing models.
• The company has recorded negative cash flows from financing activities in prior fiscal years.
• There are ongoing legal disputes involving the Company and one of its Directors.

 

IPO GMP Today

Latest GMP of Micropro Software Solutions SME IPO is Rs. 30

 

Conclusion

The company operates in a highly competitive sector and has faced negative cash flow. Furthermore, the abrupt surge in the company's revenue appears to be more of an embellishment for the offering. Seasoned investors may consider investing in the issue after thoroughly evaluating all the factors.

 

 

Finowings IPO Analysis

Hope you enjoyed the Finowings IPO Analysis. We tried our best to give every required detail about the company that you should know before applying to the IPO. 

You must consult your financial advisor before making any financial decisions. 

To Apply for the IPO, Click Here.

 

To Read the Prospectus of the Company Click Here to Download the DRHP.

 

 

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