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Salient features of the IPO:

* Chennai based data analytics firm Latent View Analytics Ltd. (LVAL), is coming up with an IPO to raise Rs. 600cr, which opens on 10th Nov. and closes on 12th Nov. 2021. The price band is Rs. 190 - 197 per share. 

* The issue is a combination of fresh and OFS. The company will not receive any proceeds from the OFS part of the issue. Of the net proceeds from the fresh issue, Rs. 148cr will be used for funding inorganic growth initiatives; Rs. 82cr will be utilized to fund the working capital requirement of its material subsidiary; and Rs. 130cr will be invested in subsidiaries. Residual funds will be used for general corporate purposes.

Key competitive strengths:

* Recognized leadership position in data & analytics with a wide range of capabilities

* Deep and entrenched relationships with blue chip clients across industries and geographies

* Consistent client driven innovation supported by functional expertise

* Scalable and attractive financial profile

* Strong leadership team guiding capability development and go-tomarket strategy

Risk and concerns:

* Geographical revenue and client revenue concentration risk

* Sector/vertical concentration risk

* Reduced D&A spending from the clients

* Difficulty in retaining and acquiring clients

* Unfavorable forex rate movements

* Declining operational efficiencies

* Competition

Below are the key highlights of the company:

* Over 2020-24, the global IT spends is expected to increase by 8.4% CAGR to reach a size of USD 4tn by 2024. As enterprises scale-up digital transformation efforts, growth in IT spends is expected to be largely driven by investments in digital technologies, which is expected to double from 2020 levels to approximately USD 2.4tn in 2024 (a 16% CAGR growth between 2020-24).

* Data & Analytics (D&A) is one of the fastest growing segments of the digital spends. The D&A market was around USD 174bn in 2020 and is expected to grow at an 18% CAGR to around USD 333bn by 2024.

* North America accounts for the largest share (approximately 40%) of the global D&A spend, while APAC (Asia Pacific) has the second highest share. In APAC, China is the largest market, while India and Singapore are the other major spenders in APAC. New governmentled initiatives and growing adoption of analytics in essential industries are driving the D&A spends in the region. Europe accounts for 23% of the global D&A spending. North America will continue to account for the largest market share of D&A spends, while APAC is expected to grow at the highest rate over 2020-24.

* India is the top outsourcing destination for analytics, and Indian companies including multi service providers and pure play analytics firms have a share of approximately 40% of the addressed market. LVAL is among the leading pure-play data analytics services companies in India and has emerged as one of the most trusted partners to several Fortune-500 companies in the last three fiscals. Some of its key clients include Adobe, Uber Technology and 7-Eleven.

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