FirstMeridian Business Services Limited IPO

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i. Within only four years since its inception, FirstMeridian Business has become India’s third-largest staffing company, in terms of revenue for the financial year ended March 31, 2022. They provide a wide range of service offerings, including
(1) general staffing and allied services, by offering contract staffing solutions, workforce automation solutions and trade marketing solutions to meet business needs of clients across diverse industries;
(2) global technology solutions, offered through short- and long-term technology contract staffing solutions for clients; and
(3) other HR services, including permanent recruitment, recruitment process outsourcing (“RPO”), pharmaceutical and healthcare staffing, facility management, engineering and technical staffing, and finance accounting and legal staffing.

ii. The company has a pan-India presence with over 53 branch offices with 126,824 Associates deployed at over 3,500 locations as 2022.

iii. They have developed sector-specific capabilities that have enabled them to serve a diverse client base in a wide range of industries, including telecommunications, retail, banking, financial services and insurance (“BFSI”), construction and infrastructure, information technology (“IT”) and information technology enabled services (“ITES”), e-commerce, manufacturing and engineering, and logistics. Certain of our key clients are set out in the following table:

iv. The company provides its clients with Associates to operate in various functional roles, such as sales and marketing, customer services, warehouse management, delivery and factory staff. The tenure at which their Associates are placed with the clients is determined by the master services agreements, scope of work and/or purchase orders, as applicable. While the tenure of placement of its Associates varies, they generally observe a placement tenure varying from 15 days to 18 months

v. To their Associates, they offer technology solutions to achieve the following:
• Paperless onboarding. DigiTrac, supported through our DigiOne in the back-end, enables onboarding remotely, with a less than 24-hour turnaround time for onboarding of Associates;
• Employee helpdesk. DigiTrac is a one-stop self-service solution for all Associates to access their attendance records and payslips, as well as our policies and training documents.

vi. Competitive Strengths

i. India’s third-largest staffing company in an industry characterized by economies of scale
ii. Diversified business across multiple end user industries and clients
iii. Demonstrated track record of organic and inorganic growth and integration

 

Objects of the FirstMeridian Business Services Limited IPO:

The Offer comprises the Fresh Issue aggregating up to ₹ 500.00 million and an Offer for Sale, aggregating up to ₹ 6,900.00 million by the Selling Shareholders. The Company proposes to utilize the Net Proceeds from the Fresh Issue towards funding the following objects: 1. Repayment and/ or prepayment of all or certain portion of outstanding borrowing (including accrued interest) availed by one of our Subsidiaries, namely Innovsource Services Private Limited; and 2. General corporate purposes  
DRHP of FirstMeridian Business Services Limited IPO

FirstMeridian Business Services Limited IPO Details:

Face Value: ₹ 10 Per Equity Share
Issue Type: Book Building
Issue Size: 740 Cr.
Listing At: NSE,BSE

Promoters And Management:

i. Avinash Vashistha is the Chairperson and an Independent Director of the Company. He obtained his bachelor’s degree of technology in the field of electrical engineering from Indian Institute of Technology, Kanpur in 1982 and his master’s degree in computer science from University of Alberta in 1985. He also holds a master’s degree in business administration from the University of Phoenix in 1993. He has expertise in the technology, consulting, capital and innovation sector. Before his association with the Company, he has held the position of a Whole time Director on the board of Accenture Services Private Limited, the CEO with Tholons Inc and a director of Bluebook Bangalore Private Limited. He has also been on the board of directors of Vaishnavkripa Realty Private Limited, Myspaces Innovations Private Limited, and Medley Medical Solutions Private Limited. He has been an active board and national member of American Chamber of Commerce, Federation of Indian Chambers of Commerce and Industry(“FICCI”), Confederation of Indian Industry (“CII”) and National Association of Software and Service Companies (“NASSCOM”) and Institute of Directors, India. He has been associated with the Company since April 12, 2022. ii. Aduthuraiperumalkoil Ramachandran Chandrasekharan (“A. R. Chandrasekharan”) is an Independent Director of the Company. He obtained his bachelor’s degree in commerce (Hons.) from the University of Calcutta in 1972 and has also completed his bachelor’s degree in Law from the University of Bombay in 1982. He is an associate member of the Institute of Chartered Accountants of India and the Institute of Company Secretaries of India, apart from being a certified associate of the Indian Institute of Bankers. He has expertise in sectors like manufacturing, engineering, banking, finance, and information technology. Prior to his association with the Company, he has served on the Board of Ashley Atleams India Limited, Ashley Bio-Fuels Limited, Adyar Property Holding Company Private Limited, Hinduja Tech Limited and Hinduja Foundries Limited, Automotive Infotronics Limited and Ashok Leyland John Deere Construction Equipment Company Private Limited. He has been associated with the Company since April 12, 2022. iii. Pooja Prabhakar is an Independent Director of the Company. She obtained her bachelor’s degree in Information Science & Engineering from Bangalore University in 1998 and a master’s degree in science from Central Connecticut State University in 2003. She obtained a Certificate in Managing Risk in Organisations from London School of Economics in 2018. She has expertise in the legal, technology & insurance sectors. In the past, she has also been associated with the United Health Group, CIGNA Healthcare and Essential Logic. Currently she is the Managing Partner of BCP Associates. She has also been a recipient of numerous awards including Woman Achiever Award & Woman Leadership Award- Excellence in Legal at 7th edition of Future Woman Leader Digital Summit & Awards 2021 and Lex Falcon Award 2021 for impactfully contributing to the Legal industry with great knowledge, reach, innovative ideas, suggestions, futuristic spirit and approach. She has been associated with the Company since April 12, 2022.  

Financials of FirstMeridian Business Services Limited IPO:

Particulars (In Cr) 2022 2021 2020
Revenue from Operations 2,862 2,110 2,058
Purchase of Traded goods 2 - -
Employees Benefit Expenses 2,705 2,011 1,983
Other Expenses 98 63 42
EBITDA 57 36 33
OPM% 1.99% 1.71% 1.60%
Other Income 7 14 17
Depreciation 37 77 76
Finance Cost 4 3 2
PBT 23 -30 -28
Tax -11 4 -8
PAT 34 -34 -20
No. of Shares 7.26 7.22 7.22
EPS 4.68 -4.71 -2.77
   

Comparison With Peers:

Name of the Company Revenue (in Cr) Profit (in Cr) EPS P/E CMP MCap
First Meridian Business Services 2,862 34 4.68 - - -
Team Lease Services Limited 6,480 39 22.4 32.7 2,244 3,837
Quess Corp Limited 13,693 251 16.3 19.9 356 5,276
   

Recommendation on FirstMeridian Business Services Limited IPO:

To be updated shortly
 

Lead Manager of FirstMeridian Business Services Limited IPO:

  1. DAM Capital Advisors Ltd (Formerly IDFC Securities Ltd)
  2. Edelweiss Capital Limited
  3. IIFL Securities Ltd
  4. JM Financial Consultants Private Limited

Registrar of FirstMeridian Business Services Limited IPO:

  1. Link Intime India Private Limited

Company Address:

Unit no. 5, 3rd Floor, RBD Icon Outer Ring Road, Marathalli Post, Bengaluru 560 037, Karnataka, India  

Discussion on FirstMeridian Business Services Limited IPO:

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