L&T Infotech IPO to kickstart today; are you subscribing?

The global IT solution provider and a subsidiary of Larsen and Toubro, L&T Infotech is all set to get listed on the exchanges. L&T Infotech IPO will open today (July 11) and will close on July 13. The company is planning to raise about Rs 1243 crores at a price band of Rs 705-710.  The IPO comprises an offer-for-sale of up to 1.75 crore equity shares by L&T Ltd., which constitutes 10.3 per cent of the post offer paid-up equity share capital. The purpose is to get listed and gain brand equity. It also aims to give autonomy to the company in its operations.

Half of the issue is reserved for QIB, out of which 60 per cent will be allotted to anchor investors. On the other hand, IPO will be open for subscription to retail and high net worth individuals from July 11. The company has set a quota of 15 per for HNIs, and around 35 per cent is reserved for retail investors.

Looking at the finances of L&T Infotech, it looks like the IPO is worth subscribing. In FY2016, revenue has increased by 21.2 per cent YoY and has fared better, giving more than 5 per cent growth in FY15. Operating profit and PAT also have increased by 23.4 per cent and 21.4 per cent YoY respectively.

On the contrary, the shares of the parent company, L&T will likely be the master of July 11 trade. The shares of L&T in the last 1 month have gained by 6 per cent. However, the shares in the last 3 months have gained by 27 per cent.