IPO Update : Everonn Systems India


Everonn - Technifying India's future, Apply for listing gains

Everonn Systems has entered the capital markets with a public offer of Rs. 50 crore worth of shares at a price band of Rs.125 -140. Investment Guru is of the view that Indian IT Training business segment has huge potential given the young demography advantage of India and hence company's imparting IT training have good potential. Everonn Systems is a play on both the IT training as well as the niche segment of "Vitels" which is a virtual and Technology enabled learning solutions. However, company is heavily dependant on government initiatives and has high debt outstandings which can impact future cash flows given company's huge capex oriented plans. However, since the issue is compared to peers like Educomp and NIIT which are quoting at fancy premiums, it may generate listing gains for Investors.

Let's look at some of the highlights of the issue

About Everonn Systems
  • India is currently one of the largest markets for School Education in the World. India currently has over 1 million schools providing education to over 200 million students. There are over 5 million teachers across ndia who needs support in training in IT and delivery of Education.

  • The Government of India has spent over Rs. 10,000 crores on Elementary Education in the country during 2005-06 through its various schemes. Besides this the Government has an outlay of Rs 2563 crores on Higher/Secondary Education during 2005-06. Education in the country is funded through a 2% Education Cess and other Budgetary Allocations.

  • Everonn system a fully integrated Knowledge Management, Education and Training Company offering a range of services that include Creating Educational and Training Content, Designing and executing large learning initiatives and Setting up the needed infrastructure for learning and training.

  • It is a leading players in setting up Virtual and Interactive Learning classroom networks across India to deliver quality and affordable education. It is developing and integrating content for Indian and global audience in schools, colleges, corporates and retail space.

  • The company has presence in eight states, over 1,300 computer labs and 1,900 schools, and trained 1.2 million students.

  • The issue proceeds would be used to fund setting up of institutional education and infrastructure services, Vitel Solutions, Brand Building and forM&A's.
Positives for the company

  • The company currently caters to over 1900 schools. It plan to add almost 1000 schools every year.

  • The company has been selected by the School Education Department, Government of West Bengal to impart computer education to students of Government schools.

  • It has also received the contract for providing certain equipments and services such as Computer hardware, software and connected accessories as per the Karnataka Govt's tender and providing computer education services and Annual Maintenance in 216 Government High Schools under the ICT Project.

  • Everonn is one of the pioneers in this space with a successful and impressive track record. ESIL’s Education Centric technology, content and support infrastructure provision to the last mile (schools) has enabled it to successfully create a niche in this sunrise segment.

Concern Areas

  • The company has very high level of Sundry Debtors of 7.8 months as on March 31, 2007. This pose risk to cash flow of the company and may impact working capital requirements.

  • The company works on BOOT model which involves huge capex outlays at initial stages.

  • The company's business is seasonal in nature.

Valuations

  • Company's Topline has grown from 16.2 crores in FY04 to 43 Crores in FY07 generating a CAGR of around 35.5 % . Profits also grew from 60 lacs in Fy04 to 4.86 Crores in FY07.

  • For the year ended 31st March,2007 company EPS stood at Rs. 5.63 which gives a P/E of 24.87 at the higher end of the price band.

  • Industry composite PE is 55

  • Weighted Average Return on Networth is 17.79%

  • Net Asset value is Rs. 62.52

  • Peer Group company Educomp Solutions which has a compartively large scale is quoting at PE multiples of 127 while NIIT is qouting at PE multiple of 67

Issue Opens :05-07-2007

Issue Closes:11-07-2007

Registrar :Cameo Corporate Services

Company Website :Everonn Systems

For IPO Allotment Status Click Here

25 comments:

Anonymous said...

Hi Rajesh

Please share your views on Welspun Gujarat. You had earlier recommended this share on your blog. Is it still a buy ?

Thanks
Mohit

Anonymous said...

Dear Sir,

Can I sell Skumar at current levels. I have bought 500 shares @ Rs. 80 after your recommendation.

Please guide
Regards
SRK

amit said...

Hi Rajesh,

Rajesh i have been reading your blogs from quite some time now.
In the due course i have developed a great sense of respect for you.
I have never met you in person nor had any chance to speak to you still i feel that i trust you.And
when i come to your blog it
appears as if i am in some very
familiar own place.

Thanks for the skumar recommendation bought at 65 still holding it,will hold until you signal a sell.Rajesh now it has been long since you have posted some stocks for a 2 -3 month horizon.

Rajesh i hope you will surely reply to this scrap.

Regards,
Amit.

Trakin said...

Hello Rajesh,
I second the view of Amit. I have been reading posts on your blog quite frequently and I think your recommendations are great, sometimes to my amazement. Keep up the great work you are doing.
Just wanted to know what are your views on Parsvanath Developers ???is it a hold ??

Vikas said...

Hi Rajesh,

How are you doing? Lot of praises going on the board and I should say that you really deserve these. I have been an old timer on your blog and needless to say that I held you in high esteem.

The best part is that you not only share your ideas, you are also doing a marvellous job of educating people about investing and all this without any expectation from our part.

Great job Sir. I wish you keep guiding us like this.

Thanks,
Vikas

Trendy said...

Hi Rajesh,

I bought 200 shares of Centurion bank @ 41. what is the outlook for this stock ? I am ready to hold for 2-3 months and I am expecting 20% return on my investment. WIll I get this ?

Kunal Bhasin said...

Soni Saab,...

Will everoon list at 300/share...ur comments pls...

Kunal

rashmi said...

Hi Rajesh,

It has been long since i have been visiting your blog.It is like a bible or rather i will say it Gita when it comes to investment wisdom.

But rajesh one thing that i dont like about your blog is that your posts are intermittent and far in between.Of lately there is a sense of discontinuity in your blogs.

Sir i Still remember that fine morning when i got to see your blog named in "Economic Times" as one of the most visited and read blog.I have a deep attachement with it,and it seemed at that time as my own success.

Rajesh please do not take it in bad sense,please not at all,but still i feel that we need more of you and well i thanks for all the good work that you have been doing.

Deep Regards ,
Rashmi.

Anonymous said...

dear sir,
markets are hot. looking forward to your guidance

KK

Stephen (steve@isuggestu.com) said...

Hello Rajesh, I apologize if I missed it, but is there an easy way to contact you? Please do let me know.

Thanks,

Stephen

Kunal Bhasin said...

SONI SAAB,

UR EXPERT COMMENTS REQUESTED FOR UPCOMING IPO'S.....

THANKS
KUNAL\

Anonymous said...

Hi rajesh

With today's fall of 550 points what is the road ahead ?

please guide.

anjali said...

Hi Rajesh,

What should be the listing strategy for everenon.I have got 50 shares in allotment.

Regards.
Anjali.

Anonymous said...

Hi Rajesh,

MnM IS AT 690 LEVELS,should we swoop it in or we may get it aat a better price.

Thnaks fopr everenon ,on ur reco i applied and earned handsome.

Thnaks
renuka.

Jonathan said...

Hi Rajesh,
We've not heard anything from you for a while.
Regards
Jonathan (Bangalore)

Rajesh Soni said...

Dear Friends,

Thanks for your kind words of appreciation for the blog.

One of the strong foundation of this blog has been the support it has got from the readers and the comments have helped me to improve the content and keep the focus of the blog intact.

I had been through a personal crisis at home for past few weeks and a hectic time as well at the job due to budgeting exercise, hence could not do justice to the blog.

I am sure I will start posting soon. Thanks for you patience.

Markets are in the correction mode and time has come to start looking at some good stocks which have corrected significantly to take a medium to long term position.

Happy Investing !

Renie said...

Hi Rajesh, please add your blog to our new directory of Indian Blogs, thanks!

http://www.indiblogger.in

Anonymous said...

Hi Rajesh,

Hope everything is fine with you. Please take care of yourself. Please take your time...we can wait for the update on blog

KK

Anonymous said...

hello sir,
I have bought 100 shares of reliance at 1740. what price can i expect in 6 months ?

terazleaman said...

Long time reader - first time poster.
Oh my gosh you guys I don't know if you've heard of ""conversations with miollionaires"" but I just found out Jason Oman who did that book is going to be doing a new one for female entrepreneurs like us. Here's the page I came across so you can get updates about it too.
conversationswithfemalemillionaires.com
I can't wait for it because I loved his first book. I hear he's gonna have Martha Stewart, Ray Rachel, Kim Kiyosaki the wife of the guy from rich dad poor dad.
You can obtain more info at http://www.conversationswithfemalemillionaires.com

Anonymous said...

Hi rajesh

How should one play the nifty options for september? hope to see your reply soon.

Thanks
Jagdish

Anonymous said...

dear rajesh...not seen updates on your blog for a long time...Hope everything is well. Looking forward to some investment ideas from you... how does RPL looks for 1 year time frame... also request your views on Skumars...the stock has got stuck into range of 105-110

A regular reader on your blog

joji said...

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Bangalore - 560037
Karnataka
e-mail :jojishpaily@gmail.com
Contact: +91 9844010054
+91 9886089896, +91 9449009983
080-32416570, 41719562

joji said...

Established in 1997, St. Gregorious Edu-Guidance is a leading education consultancy services providing exemplary service to students all over India. We deal in Admissions to all major professional courses in Premier Institutes across India. We are your one step solution for all career related needs, it may be MD, MBBS BE, BTech (ALL BRANCHES), , MDS, BDS, BPharm, BArch, MBA, MTech, MS, , PhD or any other courses. We provide personalized career solutions on an individual basis keeping in mind the aspirations of our client as well as the affordability factor.
FOR ALL CAREER RELATED NEEDS CONTACT US :
St. Gregorious Edu-Guidance,
#2, 2nd Floor,
J J Complex, Above Chemmannur Jewellers,
Marthahalli - P O,
Bangalore - 560037
Karnataka
e-mail :jojishpaily@gmail.com
Contact: +91 9448516637
+91 9886089896, +91 9449009983
080-32416570, 41719562

shilpa said...

Established in 1997, St. Gregorious Edu-Guidance is a leading education consultancy services providing exemplary service to students all over India. We deal in Admissions to all major professional courses in Premier Institutes across India. We are your one step solution for all career related needs, it may be MD, MBBS BE, BTech (ALL BRANCHES), , MDS, BDS, BPharm, BArch, MBA, MTech, MS, , PhD or any other courses. We provide personalized career solutions on an individual basis keeping in mind the aspirations of our client as well as the affordability factor.
FOR ALL CAREER RELATED NEEDS CONTACT US :
St. Gregorious Edu-Guidance,
#2, 2nd Floor,
J J Complex, Above Chemmannur Jewellers,
Marthahalli - P O,
Bangalore - 560037
Karnataka
e-mail :jojishpaily@gmail.com
Contact: +91 9448516637
+91 9886089896, +91 9449009983
080-32416570, 41719562