Capillary IPO Live: Price Band, Subscription Update, Listing Date Revealed

On Friday, Capillary Technologies India, a software company, made its initial public offering (IPO) available to the public. the subscription window will be open from now until November 18. The public offering consists of a new issue of about 60 lakh shares which is estimated to bring in Rs 345 crores plus an offer for sale (OFS) of around 92.3 lakh shares at a price of Rs 532.50 crores.

The price range for the IPO is determined to be Rs 549 to Rs 577 per share. The book-running process is being led by JM Financial, IIFL Capital Services, and Nomura Financial Advisory and Securities (India) Pvt. Ltd. MUFG Intime India Pvt. Ltd. has been designated as the registrar.

It is anticipated that the share allotment will be finished on November 19, with the successful applicants receiving shares on the next day. The refunds of the unallotted shares will also be done on the same day. Capillary Technologies intends to be listed on BSE and NSE on November 21. Prior to the IPO, the company secured Rs 394 crore from anchor investors.

Capillary Technologies ranks among the global leaders in providing innovative software technologies, such as AI-based, SaaS solutions, and cloud computing, to end-users in various sectors around the globe. The company’s Red Herring Prospectus (RHP) states that it concentrates on the areas of customer engagement, loyalty management, and AI-based enterprise solutions.

As of 10:40 a.m. on that Friday, the IPO was subscribed 0.08 times. The ratio for retail investors was 0.05 times, for non-institutional investors (NII) it was 0.26 times, and for employees 0.18 times. There had been no Qualified Institutional Buyer (QIB) subscriptions recorded at that moment. The grey market premium (GMP) remained zero, indicating the likelihood of listing at the issue price.

Seema Srivastava, Senior Research Analyst at SMC Global Securities, mentioned that Capillary Technologies has the right steers to the direction of the global market for loyalty management and it is nowadays one of the leading companies in this sector of the market worldwide. The issuer is very well known for its AI-supported SaaS predominant platform and organizes a very successful net revenue retention ranging from 112% to 143%. The company has a very vast global footprint through operations in 47 countries and a customer base of over 413 brands worldwide, and thus, it has managed to capture and penetrate the US market.

From a financial perspective, the firm declared Rs 598 crore as the sales figure and Rs 14.15 crore as the profit in FY25, which was a complete flip from the losses in FY23 and FY24 which were Rs 88.56 crore and Rs 68.35 crore respectively. The firm has attributed the turnaround to increased operating effectiveness and planned mergers and acquisitions.

Nevertheless, Srivastava has indicated that the IPO is undervalued, stipulating a post-issue P/E of 171 and 180 times and a P/B of 4.5 and 4.7 times. The top 10 customers who account for 56% of revenues and the company’s dependency on constant innovation and hiring of talented people are some of the risks. The areas of concern that the company has to deal with are cash flow problems, previous losses, and integration issues after mergers and acquisitions.

There were diverging views amongst the experts concerning the IPO. Srivastava stated that the IPO would be a good choice for investors with a high-risk tolerance and for those who are short-term players or care about safety in investments, it would be better to stay away from the issue altogether. Swastika Investmart also advised neglecting the IPO, saying that Capillary Technologies is a late comer and its position is that it is competing against the likes of Salesforce, Adobe, and HubSpot for a share of the global SaaS market.

In addition to that, Swastika pointed out that the OFS constitutes most of the IPO, that the company has only recently turned profitable and that retail investors face the danger of risk being significantly increased.