Shares of this small-cap IT stock are trading in the red today falling around 5 percent after completing a Qualified Institutions Placement (QIP) of equity shares at a discount to the floor price set by the company.
The stocks of Happiest Minds Technologies Limited are currently trading at Rs 944.10, a fall of around 5 percent compared to the previous closing levels of Rs 995.45. The company has a market capitalization of Rs 14,400 crores.
Such negative sentiments for the stock are captured after the company, in a recent filing with the Bombay Stock Exchange (BSE) dated 18th July 2023, announced the completion of a QIP of Rs 500 crores at a price of Rs 924 per equity share.
At the initiation of the issue, the company had kept a floor price, i.e., an average stock price during the period of the last two weeks, to be Rs 972.16. As compared to the floor price, the price at which the placement was completed exhibits a discount of Rs 48.16 per equity share (5.21%).
Coming onto the latest financial reports for FY22-23, the company portrays an increase in the basic operational parameters such as revenues as well as after-tax profits. The revenues increased from Rs 1,093 crores during FY21-22 to Rs 1,429 crores in FY22-23, and, the after-tax profits, during the same time horizon, took a shift from Rs 181 crores to Rs 230 crores.
Due to cost pressures, the company saw a dip in the profitability ratios with net profit margins marginally declining from 16.56 percent during FY21-22 to 16.16 percent in FY22-23. Moreover, the return on capital employed (RoCE) moved down from 34.55 percent to 31.75 percent.
As per the March 2023 shareholding information, the Promoters hold a 53.24 percent stake, and the Foreign Institutional Investors (FIIs) hold a 4.15 percent stake in the company.
Happiest Minds Technologies Limited is involved in the business of providing next-gen IT services and solutions enabling entities to capture the benefits of emerging technologies of mobility solutions, analytics, Internet of Things (IoT), etc.
Written by Amit Madnani
