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Analysts see MapmyIndia as a long term bet on being a pioneer in digital maps

Analysts see MapmyIndia as a long term bet on being a pioneer in digital maps
  • CE Info Systems (MapmyIndia) is expected to fetch ₹1,039 crore from the public listing.
  • MapmyIndia is a leading provider of advanced digital maps, geospatial software, and location-based internet of things (IoT) technologies in India.
  • Shares of the company are demanding a huge premium of ₹800 in the grey market over the price band of ₹1,000-₹1,033 per share.
Today, December 9, is the first day of subscription for the initial public offering (IPO) of CE Info Systems — which operates MapmyIndia.

The IPO may receive a great response from investors considering the grey market indicates a huge premium of ₹800 per share over the price band of ₹1,000-₹1,033 per share.

MapmyIndia is looking to sell over 1 crore equity shares to raise ₹1,039 crore. The entire offer is completely an on offer for sale (OFS) by existing shareholders of the company.

The company is one of its kind that builds digital map data, telematics services, location-based software-as-a-service (SaaS) and geographic information system (GIS) services.

Another reason to subscribe for the IPO is positive reviews by several brokerage firms to invest for the long term.

Brokerages

Recommendations

Angel One

Subscribe for the long term

Ashika Stock Broking

Subscribe for the long term

Investmentz

Subscribe for listing gains


“MapmyIndia being a pioneer, has certain advantages as its digital maps and other solutions are localised for the challenging Indian Geography and are extensive in terms of coverage. There is scope of further up selling or cross selling while the maps and platform are constantly updated with validated feedbacks [sic] which can create network effect [sic],” said a report by Angel One.

“Considering the company’s leadership position in India, client base and benefits of network effect, healthy margins and return profile as well strong cash conversion, we recommend SUBSCRIBE on the issue from a long-term perspective,” added the brokerage firm.

Some of the company’s clients include PhonePe, Flipkart, Yulu, HDFC Bank, Airtel, Hyundai, MG Motor, Avis, Safexpress and Goods and Service Tax Network (GSTN). It has over 500 customers.

Ravi Singhal, vice chairman at GCL Securities feels that MapmyIndia is offering a great business model with entry barriers along with promising growth potential.

Meanwhile, some of the analysts are recommending to subscribe the IPO only for listing gains and here’s why.

Manoj Dalmia, founder and director at Proficient Equities, said that one may subscribe to MapmyIndia for listing gains considering its GMP (which is at ₹800) and client base.

Usually, shares that demand a huge premium till the last day of the IPO tend to give higher gains on the day of listing.

Analysts at Investmentz believe that while MapmyIndia is well placed to capitalise on domestic opportunities, its upper price band of ₹1,033 per share is aggressively priced. The broking firm has recommended subscribing for the IPO for listing gains.

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