CE Info Systems Ltd, operating as MapmyIndia, has recently announced plans to raise funds worth up to ₹500 crore through a Qualified Institutional Placement (QIP). This decision was approved by the company’s board on a Monday, as revealed in a filing with the Bombay Stock Exchange (BSE). The fund-raising process will involve the issuance of equity shares, each having a face value of ₹2, for a total amount not exceeding ₹500 crore. This move is subject to receiving necessary approvals from shareholders and regulatory and statutory bodies.
In the financial performance context, MapmyIndia demonstrated robust growth in the September quarter (Q2 FY24). The company reported a net profit of ₹33 crore, marking a 30% increase from the ₹25.4 crore recorded in the same period the previous year. Its revenue from operations also saw a significant jump of 19.4%, reaching ₹91.1 crore compared to ₹76.3 crore in the corresponding period last year.
The company’s stock performance has also been noteworthy. On a Friday, the stock closed 0.39% higher at ₹2,200.45. However, the trading volume on that day was lower than the two-week average, with only 4,447 shares changing hands. Despite this, MapmyIndia commanded a market capitalization of ₹11,893.05 crore. As of September 2023, the company’s promoters held a 52.93% stake.
MapmyIndia, known for providing services like Digital Maps as a Service (MaaS), Software as a Service (SaaS), Platform as a Service (PaaS), and Internet of Things (IoT), has shown substantial growth in its operations. From FY22 to FY23, the company’s revenue from operations grew by 40%, from ₹200 Crores to ₹281 Crores, accompanied by an increase in profits from ₹87 Crores to ₹107 Crores. This growth has been reflected in the company’s return on equity (ROE) of 19.78% and a return on capital employed (ROCE) of 25.54%, indicating efficient returns on equity and capital employed. The company’s stock, however, is currently trading at a high price-to-equity (P/E) ratio of 95.26 and a price-to-book (P/B) value of 19.67, with an analyst target price suggesting a potential downside of 7% in a year.
Overall, MapmyIndia’s decision to raise funds via QIP is a strategic move that aligns with its recent financial growth and market performance, and it reflects the company’s ongoing efforts to expand and strengthen its position in the market.