AFTER seven years, Mindtree Consulting, known for its high-profile management team, has finally thrown its hat into the public markets. The company has fixed a price band of Rs 365 to Rs 425 for its initial public offering (IPO). The IPO is for 5.6 million shares, representing 15% of the postissue share capital of the company. After reservation for employees and business associates, the net issue to the public is of 4.94 million shares of Rs 10 each. The IPO proceeds will be used for investments in new facilities, pre-payment of loans and for acquisitions.
The company had made two small acquisitions in 2004 and 2005, and intends to pursue growth through acquisitions more aggressively going ahead, CMD, Ashok Soota, said. The issue price values the company at 18.25 times its FY06 earnings at the lower end of the band and 21.25 times the FY06 earnings of Rs 20 at the higher end of the band. The company had revenues of Rs 455.4 crore and a net profits of Rs 54.3 crore for fiscal 2006. For the nine month period ended December 30, 2006, it had revenues of Rs 439.1 crore and net profit of Rs 65.5 crore.
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