Ahmedabad, India – October 3, 2024: Dev Information Technology (Dev IT) experienced a remarkable surge in its share price, which jumped by 7.23% to reach an intraday high of ₹169.60 on Thursday, following the announcement that its subsidiary, Dev Accelerator Limited (DevX), filed a draft red herring prospectus (DRHP) for an upcoming initial public offering (IPO). This strategic move aims to bolster DevX’s expansion into the coworking space sector, tapping into the growing demand for flexible office solutions in India.
A milestone for dev X
The filing of the DRHP is seen as a significant milestone for DevX, reflecting the parent company’s commitment to enhancing its presence in the dynamic and evolving workspace sector. Pranav Pandya, founder and chairman of Dev Information Technology, expressed optimism about the IPO, stating, “We are pleased to announce the filing of the DRHP for our promoted company, DevX. This significant milestone underscores our commitment to the dynamic growth of the flexible workspace sector in India.”
The IPO is strategically designed to enable DevX to capitalize on the increasing demand for innovative and adaptable workspace environments, tailored to meet the diverse needs of clients across the country.
Dev X IPO overview
The forthcoming IPO of DevX will consist of a fresh issue of up to 2.47 crore equity shares, each with a face value of ₹2. The shares will be listed on both the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE), providing investors with access to the burgeoning coworking sector.
Utilization of IPO funds
The funds raised through the IPO will be primarily allocated to enhancing the company’s infrastructure and financial stability. Specifically, ₹68.95 crore will be directed towards “fit-outs” in new centers and security deposits, ensuring that the facilities are well-equipped for smooth operations.
Additionally, ₹30 crore will be earmarked for the repayment and/or prepayment of certain borrowings, contributing to the strengthening of DevX’s balance sheet. The remaining proceeds will be utilized for various general corporate purposes, including strategic initiatives, marketing enhancements, brand building, lease liabilities, acquiring fixed assets, and overall business development. This capital infusion positions DevX for significant future growth, especially in major cities such as Mumbai, Gurugram, Noida, Pune, Chennai, GIFT City, Ahmedabad, Vadodara, Rajkot, Surat, Goa, and Jaipur.
Current operations and future plans
As of August 31, 2024, DevX operates 25 centers across more than 10 cities, including Ahmedabad, Vadodara, Hyderabad, Delhi, and Udaipur. The proceeds from the IPO are expected to bolster its position as a leading player in the managed office space sector, enabling the company to serve a wider range of clients effectively.
Pandya noted, “This IPO will not only enhance DevX’s operational capabilities but also strengthen its financial stability. By securing additional capital, DevX aims to broaden service offerings and elevate customer experiences. The funds raised will be instrumental in accelerating DevX’s expansion plans, enabling DevX to enter new markets, enhance its infrastructure, and invest in technology that drives efficiency.”
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Dev Information technology’s legacy
Founded in 1997, Dev Information Technology Limited has evolved from a small-scale business automation software provider to a global leader in IT services. Headquartered in Ahmedabad, with offices across India and in Canada, the company prioritizes continuous innovation, quality, streamlined processes, and technological excellence.
Dev IT offers a comprehensive range of services, including Cloud Services, Digital Transformation, Enterprise Applications, Managed IT Services, and Application Development. Among its notable product offerings are Talligence, an analytics platform, and ByteSigner, a digital signing solution. In FY24, the company reported a revenue of ₹165.12 crore, an Earnings Before Interest, Tax, Depreciation, and Amortization (EBITDA) of ₹15.31 crore, and a Profit After Tax (PAT) of ₹9.48 crore.
As Dev Information Technology positions itself for future growth through the DevX IPO, it aims to leverage its existing strengths and capitalize on the increasing demand for flexible workspaces in India, thereby enhancing its footprint in the coworking sector. The significant share price increase reflects investor confidence in this strategic move, paving the way for a promising future.
