Data Patterns IPO: Opens tomorrow; find key details that investors must know before investing

Data Patterns IPO: Data Patterns (India) Limited, a vertically integrated defence and aerospace electronics solutions provider, will launch its initial public offering tomorrow, Tuesday, December 14, 2021. The issue will fetch Rs 588.22 crore to the company. The three-day issue will close on Thursday, December 16, 2021.

The company has fixed a price range of Rs 555-585 per equity share. A retail investor can bid for a minimum of 25 equity shares and in multiples thereafter. At the upper end of the price band, one lot is worth Rs 14,625.

The maiden issue comprises a fresh issue component up to Rs 240 crore and an offer for sale (OFS) 59.52 lakh equity shares. The OFS includes the sale of up to 19,67,013 equity shares by Srnivasagopalan Rangarajan (founder promoter), up to 19,67,012 equity shares by Rekha Murthy Rangarajan (founder promoter), up to 75,000 equity shares by Sudhir Nathan, up to 4,14,775 equity shares by G.K. Vasundhara and up to 15,28,750 equity shares by existing shareholders.

A 50 per cent of the net issue is reserved for qualified institutional buyers, while 15 per cent for non-institutional bidders and 35 per cent of the net issue is reserved for retail investors.

The company intends to utilize the net proceeds from the fresh issue to the extent of Rs 60.8 crore for prepayment/repayment of certain outstanding borrowings availed by the company. Rs 95.2 crore will be used for funding its working capital requirements and Rs 59.8 crore will be used for upgrading and expansion of its existing facilities at Chennai and general corporate purposes.

JM Financial Limited and IIFL Securities Limited are the Book Running Lead Managers of the issue while Link Intime India Private Limited is the registrar for it.

Data Patterns (India) is among the few vertically integrated defence and aerospace electronics solutions provider catering to the indigenously developed defence products industry. It has design capabilities across the entire spectrum of strategic defence and aerospace electronics solutions including processors, power, radio frequencies ("RF") and microwave, embedded software and firmware and mechanical engineering. Its core competencies include electronic hardware design and development, software design and development, firmware design and development, mechanical design and development, product prototype design and development, functional testing and validation, environment testing and verification and engineering services opportunities.

With net profitability growth of approximately 164 per cent between Fiscal 2020 and Fiscal 2021, Data Patterns is one of the fastest-growing companies in the Defence and Aerospace Electronics sector in India. (Source: Company Commissioned F&S Report).

The company has proven in-house design and development capabilities and experience of more than three decades (including through our erstwhile subsidiary) in the defence and aerospace electronics space. Our offerings cater to the entire spectrum of defence and aerospace platforms – space, air, land and sea. Between Fiscal 2019 and Fiscal 2021, Data Patterns was amongst the highest growing companies in terms of revenues amongst key Indian defence and aerospace companies as captured in the Company Commissioned F&S Report, with a growth in our revenues of 71 per cent during this period.

Further, between Fiscal 2020 and Fiscal 2021, it recorded the highest growth in revenues amongst key Indian defence and aerospace companies with revenue growth of 43 per cent in this period. Also, in Fiscal 2021, we recorded the highest EBITDA margin, ROCE and ROE amongst key Indian defence and aerospace companies. (Source: Company Commissioned F&S Report)