Veranda Learning IPO: Veranda Learning Solutions’ IPO to raise up to Rs 200 crore was subscribed 98 per cent so far on Wednesday, the second day of the bidding process. The initial share sale – which is an entirely fresh issuance of shares – opened for subscription on March 29 and will close on March 31. Veranda Learning Solutions provides learning solutions in online, offline hybrid and offline blended formats to students, professionals and corporate employees through career-defining competitive exams, professional courses, exam-oriented courses, short-term upskilling and reskilling courses.
Veranda Learning IPO: Price Band
Veranda Learning shares are available for bidding in a price band of Rs 130-137 apiece in multiples of 100 under the IPO. At the upper end of the price range, one lot will cost investors Rs 13,700.
Veranda Learning IPO: Reserved Portions
Under the Veranda Learning IPO, 75 percent of the total shares are reserved for QIBs, 15 percent for NIIs and 10 percent for retail investors. Veranda Learning Solutions shares will be listed on stock exchanges BSE and NSE on April 7.
Veranda Learning IPO: Subscription Status
The initial public offering (IPO) of Veranda Learning Solutions had been subscribed 98 percent, garnering bids for 1.15 crore equity shares against an offer size of 1.17 crore equity shares, by the morning of March 30, the second day of bidding. Retail investors who bid 5.82 times their allotted quota continued to show interest in the public issue. The portion set aside for non-institutional investors has been subscribed 97 per cent and that of qualified institutional buyers 5 per cent.
Veranda Learning IPO: GMP
According to market observers, Veranda Learning IPO GMP (grey market premium) is not available as the stock is yet to make its debut in the grey market.
Veranda Learning IPO: What Do Analysts Say?
“The company is bringing the issue at price-to-book multiple of 8.15x on pre-issue book value basis. Although the company’s business model is technology-driven, asset-light and scalable with a proven track record of promoters along with a result-oriented method of teaching with a 360-degree approach and diversified course offerings and delivery channels but looking at the financials of the company and valuations, we recommend “avoid” on the issue,” said Astha Jain, Senior Research Analyst at Hem Securities.
In the financial year ended March 2021, Veranda posted a loss of Rs 8.3 crore on a revenue of Rs 2.54 crore, and in the six months period ended September 2021, the loss was at Rs 18.3 crore on increased revenue of Rs 15.46 crore.
On FY22 annualized financials, the IPO is at 25x market cap/sales for a loss-making company with a low track which looks expensive and the market is highly competitive, said Arafat Saiyed, Research Analyst, Reliance Securities.
Analysts are skeptical over the issue following its muted financials, negative bottomline, pricey valuations, tepid growth, and high competition in the education sector.
“The IPO is aggressively priced and hardly leaves anything meaningful on the table for investors in the medium-term perspective,” Saiyed added. “All positives are captured in its valuation and valuation is not favourable for investors.”
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