CMS Info Systems' is the last listing in 2021. With this, 65 companies made a debut on the bourses during the year after more than Rs 1.31 lakh crore of IPOs.
Cash management company CMS Info Systems saw a muted listing after lower-than-expected IPO subscriptions and rising Omicron cases soured investor sentiment. The stock opened at a premium of 2 per cent on December 31.
The stock started trading at Rs 218.50 against the issue price of Rs 216 per share on the BSE, while it started the day at Rs 220.20 on the National Stock Exchange. This is the last listing in 2021.
The company's public issue, promoted by Baring Private Equity Asia affiliate Sion Investment Holdings, witnessed 1.95 times subscriptions during December 21-23. All types of investors supported the proposal, with eligible institutional investors bidding 1.98 times, retail investors 2.15 times, and non-institutional investors 1.45 times the allotted quota.
The public issue of CMS Info Systems was worth Rs 1,100 crore and was purely an offer for sale by promoter Sion Investment Holdings.
Most analysts had a membership rating for the issue, noting that the firm is a leading player in the cash management system, has a pan-India footprint with strong fundamentals and long-standing relationships with leading banks.
“India is the third largest ATM market in the world with significant under-penetration. There are also government incentives in favor of the sector. This gives CMS immense opportunities to grow their business. They are backed by a senior management team Which includes highly experienced and qualified professionals. On the upper price band, the stock is valued at a PE of 16.4x (based on FY22 annualized earnings) on post issue equity. The company has also displayed positive financial performance Therefore, we give it a "subscribe" rating for the long-term issue," BP Wealth said.
With strong potential for revenue growth and improvement in operating margins, Venture Securities had also recommended subscribe with a price target of Rs 294. "This represents 36.1% up from the issue price of Rs 216 per share."
Having a leadership position in cash management systems, the management feels that the shifting trend towards outsourcing is bound to benefit CMS Info Systems. According to the company, outsourced ATMs are expected to grow at a CAGR of 10 per cent and outsourced organized retail points to grow at a CAGR of 13 per cent in FY 2011-27.
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