Quadpro ITeS Limited, started in 2010 at Bangalore, is providing Information Technology (IT) and Information Technology (IT) enabled services, cash management services (CMS), Cheeque Truncation System (CTS), Door step Banking services, Software Development Services, Banking transaction processing services, Document management services for telecommunication companies, Non Banking Finance companies, internet services providers, Data base Management Services, Digital Document verification for payment banks, Supply of IT and ITeS Hardware, Skilled and unskilled man power supply services etc. They also provide E2E (End to End) service provider right from Know Your Customer (KYC) spot audit / pickup of forms from the distributor's point, thorough Know Your Client (KYC) audit at nearest spoke office, data entry of application form in to the online portal, opening an account, verifying the voter ID / Aadhaar number from their web portal, and activating the SIM of the customer in a limited Turn Around Time (TAT), outward from spoke, transporting forms to the centralised HUB, inward at HUB, Bar Coding, Gumming Photograph, De-stapling, Scanning, Re-stapling, Image Splitting, File Naming, Batch preparing up to final warehousing. Quadpro has been on the front line of NACH Processing by developing an in-house application called “QUADQUICKNACH” which has been widely used for more than 150 clients' requirements by Yes Bank. Life Insurance Corporation of India is one of the biggest clients of Yes Bank whose mandates range from 25 Divisions. Specifically, there are 13 divisions from the Southern Divisional Offices and 12 divisions from North Eastern Divisional Offices.. On the financial performance front, Quadpro reported turnover/net profits (loss) of Rs. 15.07 cr. / (0.66) cr. (FY19), Rs. 12.91 cr. / 0.21 cr. (FY20) and Rs. 10.34 cr. / Rs.0.72 cr. (FY21). So company has shown decline in sales, but surprisingly profit has been increased in all these years. For the last three years, company has posted average EPS of Rs.1.57 and RoNW of 10.29%. The issue is priced at a P/BV of 1.80 based on its NAVs of Rs. 11.13 post issue. As per FY21 earnings, on fully diluted equity post issue, IPO is priced at P/E of around 70, which looks very aggressively priced. We may find better options available in open market. Comparison between listed peers is shown in above table. On BRLM's front, BEELINE BROKING LIMITED associated with this SME IPO and handled 9 IPOs in last 3 years. From last 9 IPOs, four opened below issue price and remaining above issue price. As of now from 9 IPOs, five are trading below and remaining are trading above issue price or at par. ( As on 22.09.21 ) For Quadpro financials are average, RoNW is 25.44%, P/E is around 70 for FY21. So issue looks aggressively priced. The sector of IT & ITeS is very promising sector of future and expected to show good growth in upcoming years, but it's highly competitive. Performance of BRLM is poor. So we give AVOID rating to this SME IPO.
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