Global IT services company Hexaware Technologies’ shares went up 10 per cent on listing on Wednesday. The company formally announced its initial public offering (IPO) on February 12, 2025, the largest IPO in IT services aggregating up to ₹8,750 crore with a price band fixed from ₹674 to ₹708 per equity share.
On the National Stock Exchange (NSE), Hexaware shares debuted at ₹745.50, a 5 per cent premium over the price band, while the Bombay Stock Exchange (BSE) listed the stocks at a 3.14 per cent premium at ₹731. The stock closed at ₹755.75 on the NSE and ₹763.85 on the BSE.
Largest IPO
According to Carlyle, global investment firm and Hexaware’s partner, said the company’s total IPO issue size of $1 billion making it the largest IPO globally in over a decade for tech services. Carlyle, acquired Hexaware in 2021 through a global cross-platform deal by Carlyle Partners (CP) and Carlyle Asia Partners (CAP).
Kapil Modi, Managing Director, Carlyle India Advisors, said, “Hexaware exemplifies how we seek to leverage our One Carlyle global network to help businesses scale and expand. We congratulate Hexaware’s exceptional management team on this milestone. Carlyle remains committed to partnering with the Hexaware team as it continues to focus on client centricity and delivering differentiated value for its customers, and as it embarks on its next phase as a publicly traded company.”
R Srikrishna, CEO, Hexaware, said, “This is an opportunity to deepen our relationships with stakeholders and reinforce our commitment to operating with transparency, accountability, and a focus on delivering meaningful solutions to our clients.”
Satish Chandra Aluri, Lemonn Markets Desk, said “Hexaware Technologies debuted on the stock market on February 19 with a modest premium. Shares opened at ₹745.50 on the NSE, up 5.3 per cent from the IPO price of ₹708, and at ₹731 on the BSE, a 3.25 per cent rise. The IPO was entirely an offer for sale by promoter CA Magnum Holdings and was subscribed 2.66 times overall. Retail investors showed weak interest, subscribing to just 11 per cent of their quota. Subdued listing was along the expected lines due to weak market conditions and the absence of a grey market premium. Despite being priced attractively relative to peers, broader market weakness led to a muted retail interest and debut.”
Hexaware specialises in AI-first solutions, and has over 31,000 employees across 54 offices in 28 countries. It offers AI-powered platforms and enables enterprises worldwide to realise digital transformation at scale and speed by partnering with them to build, transform, run, and optimise their technology and business processes. It serves clients across the banking, financial services, capital markets, healthcare, insurance, manufacturing, retail, education, telecom, high-tech & professional services, travel, transportation, and logistics sectors.
Looking at market opportunities for the company, Bajaj Broking earlier said, that the application services market will reach ₹32.4-33.2 trillion by 2029, with a 4.8 per cent CAGR. Software Product Engineering Services, driven by digital transformation and advanced technologies, is expected to grow at a 13-14 per cent CAGR. The global cloud and infrastructure services market, is estimated to grow at a 7.5 per cent CAGR from 2024 to 2029, driven by multi-cloud strategies, cloud migration, security, AI automation, edge computing, IoT integration, and management services. Further, the global enterprise platform IT services market, is projected to grow at a 6.5 per cent CAGR from 2024 to 2029, driven by experience transformation, cloud adoption, integration, advanced analytics, and continuous innovation from technology partners.
JM Financial projected its EBITDA margin to reach 17.1 per cent in FY27E, an expansion of 170bps over CY23-27E. This increase will be driven by 120bps improvement in adjusted EBITDA margin and reduction in one-off expenses aiding reported margins by 50bps.
“We believe Hexaware has multiple traditional levers still to pull such as offshoring, utilisation, sub-con and pyramid. We expect the one-time costs of ESOP, ERP implementation, severance and acquisition-related costs to subside, driving the margin expansion. As a result, we expect EBITDA to grow at a CAGR of 17.7 per cent over CY23-27E,” said JM Financial in a report.
Further, it expected profit after tax (PAT) to grow at a CAGR of 16.3 per cent over FY23-27E, largely due to growth and margin expansion estimates, aided by slightly higher other operating income. It initiated with a Buy and target price (TP) of ₹820, implying 16 per cent upside from the upper end of its IPO price band.
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