EbixCash, a prominent player in India’s fintech sector, is set to launch its Initial Public Offering (IPO), with a goal of raising ₹6,000 crore. The company, which operates in multiple sectors like financial technology, payment solutions, and travel & money exchange services, is positioned as a key competitor in India’s rapidly growing digital economy.
In this blog, we explore the EbixCash IPO—its objectives, business model, financial performance, strengths, and risks—so you can make an informed decision.
About EbixCash: A Leader in Financial Technology and Services
Founded as part of Ebix Inc., a global leader in technology solutions, EbixCash is a technology-enabled provider of digital products and services. The company operates across three core business segments:
- Payment Solutions: Domestic and international money remittances, prepaid gift cards, utility payments, and Point of Sale (PoS) services.
- Financial Technologies: SaaS and self-hosted solutions, including lending, wealth management, insurance, and bus exchange technologies.
- Travel & Money Exchange Services: A travel exchange platform serving customers in over 75 international jurisdictions, including forex services and ticketing.
With its broad service offerings and strong presence both in India and globally, EbixCash has positioned itself as a leader in the fintech space, catering to B2B, B2C, and B2B2C customers. As of December 2021, the company operated through over 650,000 physical agent outlets and a robust digital omni-channel platform.
EbixCash IPO Details and Objectives
EbixCash’s IPO is set to raise up to ₹6,000 crore through a fresh issue of shares, with no offer-for-sale component. The company plans to use the funds raised for working capital requirements, repayment of borrowings, and general corporate purposes.
IPO Structure
- Fresh Issue Size: ₹6,000 crore
- Listing: Proposed on BSE and NSE
- Registrar: Link Intime India Private Limited
- Offer Type: 100% book-built issue
Objectives of the IPO
The funds raised will be utilized for:
- Working Capital: To meet the working capital needs of EbixCash’s subsidiaries, which operate in highly capital-intensive sectors like travel, forex, and technology.
- Repayment of Borrowings: To reduce the company’s debt, improving its financial stability and reducing interest costs.
- General Corporate Purposes: To enhance the overall business and operational efficiency, supporting the company’s long-term growth objectives.
Financial Health and Performance
EbixCash has shown strong financial growth and improved profitability, with consistent revenue and net profit growth over the past few years. Below is a snapshot of its key financial metrics:
| Particulars (₹ in Crore) | FY 2023 | FY 2022 | FY 2021 |
| Revenue | ₹2,371.93 | ₹1,622.95 | ₹1,043.69 |
| Profit After Tax (PAT) | ₹751.31 | ₹482.09 | ₹230.31 |
| Net Worth | ₹5,136.53 | ₹4,402.72 | ₹2,997.55 |
| Total Assets | ₹7,733.70 | ₹6,798.22 | ₹5,689.76 |
| Borrowings | ₹913.23 | ₹925.00 | ₹800.00 |
| Earnings Per Share (EPS) | ₹7.96 | ₹5.20 | ₹2.54 |
| Return on Equity (RoE) | 14.63% | 10.95% | 7.61% |
Key Financial Insights:
- Revenue Growth: EbixCash reported a 127% increase in revenue over the last three years, demonstrating robust growth in its business segments.
- Profitability: The company has more than tripled its profit over the last two years, indicating improved operational efficiency and profitability.
- EPS Growth: Earnings Per Share (EPS) has risen from ₹2.54 in FY21 to ₹7.96 in FY23, highlighting strong earnings growth.
- Debt Reduction: The company has seen a reduction in borrowings, signaling better financial management and lower debt.
Strengths of EbixCash
- Integrated Business Model: EbixCash operates with an integrated business model offering a one-stop-shop for B2B, B2C, and B2B2C customers. Its diverse range of services helps the company maintain a robust position in various markets.
- Strong Market Position: EbixCash has a significant market share in India and Southeast Asia, thanks to its extensive network of over 650,000 physical agents and digital platforms.
- Technologically Advanced: With proprietary technology offerings and a strong SaaS business, the company is well-positioned to meet the diverse needs of its customers, ranging from financial services to travel and insurance.
- Global Reach: Operating in over 75 international jurisdictions, EbixCash enjoys a broad customer base and has a strong presence in both domestic and global markets.
- Regulatory Strength: Operating in regulated industries, EbixCash has the necessary licenses to provide payment solutions, forex, remittance, and bill payments, creating a high barrier to entry for potential competitors.
Risks and Challenges
- Dependency on Information Technology: As a technology-driven company, EbixCash is heavily reliant on its IT infrastructure. Any disruption due to system failures or cybersecurity breaches could impact operations.
- Cybersecurity Threats: The company faces the risk of cybersecurity attacks, which could result in data breaches, operational disruptions, and reputational damage.
- Competition: EbixCash operates in a highly competitive fintech and payment solutions market, where established players are continuously innovating.
- Regulatory Changes: Changes in regulations governing the fintech, remittance, and payment industries could have an adverse effect on the company’s operations and profitability.
- Fee-Based Revenue: EbixCash’s revenue model heavily relies on fees and commissions. Any failure to generate consistent income from these sources could affect its financial stability.
Industry Trends and Market Potential
India’s fintech industry is witnessing significant growth, with the ITeS (Information Technology enabled Services) market expected to grow at 5-7% CAGR through 2025. The software products industry, crucial to EbixCash, is projected to grow at 20-25% CAGR between 2020 and 2025. India’s rapidly growing digital economy, fueled by increased internet penetration, smartphone usage, and a rising middle class, provides a fertile environment for EbixCash to thrive.
Conclusion: Should You Invest in EbixCash IPO?
EbixCash offers a unique opportunity for investors to tap into the growing fintech sector in India and Southeast Asia. With a strong market position, diversified revenue streams, and a proven track record, the company is well-poised for future growth. However, investors must also consider the risks related to technological dependence, cybersecurity threats, and competition.
If you believe in the long-term growth potential of India’s fintech industry and the increasing adoption of digital payment solutions and remittance services, the EbixCash IPO could be an attractive investment. As always, make sure to conduct thorough research and consult with a financial advisor before making any investment decisions.
Source:
https://www.angelone.in/ipo/ebixcash-ipo
https://www.icicidirect.com/ipo/ebixcash-ipo
https://aliceblueonline.com/ipo/ebixcash-ipo/
https://www.bajajbroking.in/blog/ebixcash-ipo-investment-guide-details
