Mobile value added services firm One97 Communications Ltd has decided to further push back its initial public offering (IPO) to early next year as the stock markets continue to remain volatile. The Noida-based firm, backed by private equity firm SAIF Partners and Intel Capital, will look at a listing in the new year after filing an updated prospectus.
One97's issue was slated to open on December 1 but the firm had, last week, decided to postpone it to December 13, 2010. With the volatility in the markets, pricing the issue becomes tough, said One97 Managing Director Vijay Shekhar Sharma. The company is looking to mop-up Rs 120 crore from the markets.
"We don't want to delay the IPO, but given the continued volatility in the markets we want to wait as pricing becomes a tricky issue for us," said Sharma. One97 will update its red herring prospectus with numbers of second quarter (July- September), which would give more visibility to investors.
IDFC Capital and Avendus Capital are the book running lead managers to the One97 issue.
The development comes as market regulator Securities and Exchange Board of India (SEBI) has continued its investigations on various mid-cap stocks, dampening sentiments. Several issues have received lukewarm response, like Carlyle-backed Claris Lifesciences. Claris had to reduce the offer price by 20% for its Rs 300-crore issue and extend the closing date.
Also, other stocks in the mobile value added space are not performing well currently. OnMobile Global, another mobile VAS firm, closed yesterday at Rs 270 per share which is a nearly 40% discount to its issue price of Rs 440 in 2008. Tanla Solutions has also slipped way below its issue price.
Noida-based One97 is backed by private equity firm SAIF Partners and Intel Capital, the corporate venture capital arm of chipmaker Intel Corporation. SAIF Partners has a 36.7% stake in company while Intel Capital holds a 9.7% stake in the firm. Promoter Sharma holds a 38.52% stake.
IDFC Hybrid Infrastructure Portfolio and Reliance Capital have also picked up stake in One97 from early investor Peeyush Aggarwal in secondary transactions. One97 ended FY10 with revenues of Rs 112 crore with a profit before tax (PBT) of Rs 26 crore. According to Q1FY11 numbers, revenues stood at Rs 36 crore and PBT at Rs 10 crore. One97 reported revenue of Rs 40.7 core in FY08, which doubled to Rs 81.4 crore in FY09.