ITI is coming up with an FPO opening on 24th of January, 2020. The company has fixed a price band of Rs 72-77 a share for its FPO which is approx. 20% discount from the closing price of its share at NSE on 23rd of January, 2020. The FPO will be closed on 28th of January, 2020.

State-owned public sector company Indian Telephone Industries Limited (ITI) is telecom equipment maker and is based in Bengaluru. ITI was incorporated in 1950 and operates under the department of telecommunications.

ITI manufactures a diverse range of Information and technology, telecommunication products and provides maintenance and support solutions for these. ITI caters to wide and diverse industries like telecommunications, defence, financial institutions, defence, information technology  etc. It’s primary customers are other PSUs or government departments like BSNL – Bharat Sanchar Nigam Limited, MTNL – Mahanagar Telephone Nigam Limited, BBNL – Bharat Broadband Network Limited, Energy Efficiency Services Limited (EESL), MoD – Ministry of Defence, MoRD – Ministry of Rural Development and other paramilitary forces etc. ITI is actively engaged in other government projects also such as BharatNet, ASCON and projects related to E-Governance etc.

ITI has a wide range of product portfolio to meet the requirements of its customers. that includes products related to optical and data network, security encryption products for communication in defence sector, set-top boxes for DTH, smart energy meters for power distribution sector, passive infrastructure products for telecom industry, multi-capacity encryption units etc. It also manufactures mini personal computers and smart cards. Apart from manufacturing the company also provides solutions for operations and maintenance of BTS – Base Transceiver Stations, authentication service for Aadhaar, maintaining NPR – National Population Register NPR. ITI also provides AMCs – annual maintenance contracts and hosting of data centre to various government departments.

ITI fulfils the equipment needs of all its customers through 5 manufacturing units located at Bengaluru, Mankapur, Naini, Palakkad and Raebareli. ITI also has a research and development facility at its Bengaluru establishment. ITI outsources some of the manufacturing and procures equipment from its other technology partners also. As on August 31, 2018, ITI had a workforce of 3,427 employees.

ITI Financials

Particulars For the year/period ended (? in Million)
Period 31-Mar-18 31-Mar-17 31-Mar-16 31-Mar-15
Total Assets 47,057.38 32,048.94 35,230.86 30,248.47
Total Revenue 18,116.17 20,887.16 17,903.11 6,640.29
Profit After Tax 2,305.64 2,663.91 2,372.18 -2,979.95

In the future ITI is looking forward to diversify its range of products and services. Being a PSU and primary source of all telecommunication requirements of the government ITI can capitalise its leverage and relationship with the different departments of the government and other PSUs in modernising their structure of infrastructure and technology. ITI is also collaborating with leaders of innovative technology field and other start-ups so that it can support Digital India, Make in India and initiatives of the E-Governance government.

ITI FPO is a fresh issue of up to 18 crore equity shares. Apart from this an additional issue having up to 18 lakh shares will also be reserved for its employees.

ITI FPO Snapshot

Issue Open Jan 24, 2020 – Jan 28, 2020
Issue Type Book Built Issue FPO
Issue Size 181,800,000 Eq Shares of ?10
(aggregating up to ?1,399.86 Cr)
Fresh Issue 180,000,000 Eq Shares of ?10
(aggregating up to ?[.] Cr)
Face Value ?10 Per Equity Share
Issue Price ?72 to ?77 Per Equity Share
Market Lot 150 Shares
Min Order Quantity 150 Shares
Listing At BSE, NSE
Market Cap (? Cr.) 8307
Date for Finalisation of Basis of Allotment Jan 31, 2020
Date for Initiation of Refunds Feb 3, 2020
Date for Credit of Shares to Demat Acct Feb 4, 2020
IPO Shares Listing Date Feb 5, 2020

 

The company will  garner Rs 1,386 crore from its FPO if subscribed at the higher band of price i.e. Rs 77 per share, though if subscribed at the lower end of the price band i.e. Rs 72 per share the company will fetch Rs 1,296 crore. The issue will have not less than 75% allocation of the shares to qualified institutional buyers, not more than 15% shares to non-institutional bidders and not more than 10% to retail individual bidders.

The primary objective of the issue is to fund working capital requirements for the FY 2020-21 and repay the loan of Rs 607.30 crore in full or partially. This FPO will also help the company to meet the requirement of SEBI to have minimum 25 per cent public shareholding.

The company has appointed Karvy Investor Services , BOB Capital Markets, and PNB Investment Services as the book running lead managers to the Issue.

 

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