Tejas Networks Limited is optical and data networking product company whose products are used to build high speed communication networks. Tejas Networks Limited is coming up with an IPO. They are going to introduce their initial public offer which will hit the primary market on 14th June 2017 and closes on 16th June 2017. The company aims to raise around Rs. 800 crore by offering shares at Rs. 250-Rs. 257 per Equity Share.
Tejas Networks Limited was incorporated as Tejas Networks India Private Limited on
April 24, 2000 at Bengaluru, Karnataka. They have customers in over 60 countries and provide products of optical and data networking. The firm design, develop and sell different high performance and cost competitive products to telecommunications service providers, internet service providers, utility companies, defense companies and government entities (collectively, “Communication Service Providers”).
The firm’s products are used to build high speed communication networks which carry voice, data and video traffic from fixed line, mobile and broadband networks over optical fibre. Their products utilize programmable software defined hardware architecture with a common software code- base that delivers an app like ease of development and upgrades of new features and technology standards.
Their teams have in optical communication systems, networking protocols etc so they develop over 40 carrier-grade equipment, over 300 high-speed PCB (printed circuit board) and over 250 silicon intellectual properties (“IPs”). They have filed 326 patent applications, with 198 filings in India, 87 filings in the United States and 6 filings in Europe, out of which 47 patents have been granted. They have also filed 35 patent applications under the Patent Cooperation Treaty. They outsource their manufacturing to electronics manufacturing services (“EMS”) companies.
They sell their products via a combination of direct sales to Communication Service Providers as well as by leveraging relations with global optical vendors as well as integrated solution providers as original equipment manufacturer (“OEMs”).
They have local presence in India with four sales offices and 15 support centers around the country, which enable them to provide high quality customer support. Many firms are using their products such as Bharti Airtel Limited, Tata Communications, Aircel Limited and Bharat Sanchar Nigam Limited, Power Grid Corporation of India, RailTel Corporation of India.
• End-to-end portfolio of optical networking products positions us well to take advantage of the expected industry growth
• Leadership in the fast growing Indian optical equipment market
• Track record and culture of innovation leading to product and technology leadership
• Software-defined hardware with ease of use
• Cost and capital efficient business model
• Long standing customer relationships with strong repeat business
• Strong professionally managed team with significant industry experience
• Continue investments in innovations focused on the high growth optical networking segments
• Expand into newer and adjacent product areas
• Continue to strengthen our leadership position in India
• Expand global sales network in emerging and selected developed markets
Objects of the Issue:
The Offer made of Fresh Issue and the Offer for Sale.
1. Offer for Sale – The Company will not receive any proceeds from the Offer for Sale.
2. Fresh Issue – Company proposes to utilize the Net Proceeds towards funding the following objects:
• Capital expenditure towards payment of salaries and wages of research and development team
• Working capital requirement
• General corporate purposes.
Financial and other details
The revenue have grown from 212 crore to 674 crore in 2016 growing at a respectable CAGR of 33.53%. The base is small and so the growth looks good. Because of the high Depreciation and Finance cost, the profit is not consistent. Based on this, the EPS was 4.46 and diluted EPS was 4.13. As the asking price of Rs 257, it translates in P/E of 57.
There are no similar company listed on the exchanges.
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