IPO corner: Xtranet Tech issue opens at ₹120-127 price band

The IPO of Xtranet Technologies opens today and closes on July 27. Xtranet Technologies Limited, an integrated IT solutions provider, is launching its ₹166.8-crore IPO at a price band of ₹120 to ₹127. Market lot is 110 shares.

Xtranet Technologies Ltd. (XTL), incorporated in 2002 with its registered office in Bhopal, Madhya Pradesh, is an integrated information technology solutions provider backed by over 24 years of experience. Operating across diverse industries and geographies, the company delivers end-to-end services encompassing enterprise applications, digital services, managed services, proprietary platforms, and strategic technology partnerships. XTL serves both government and public sector undertakings (PSUs) as well as private sector clients, deriving a majority of its revenues from government and PSU projects through a mix of fixed-price contracts, time-and-materials arrangements, and recurring service agreements.

The company’s core service offerings are categorised into enterprise applications, managed services, digital services, and proprietary platforms and products. XTL provides comprehensive enterprise resource planning (ERP) services spanning global platforms alongside its proprietary X-ERP system. Furthermore, it acts as an IT system integration specialist, merging hardware, software, and networking into unified solutions for enterprises and government entities. This infrastructure portfolio covers site assessment, server virtualization, cloud setup, 24x7 infrastructure monitoring, backup and disaster recovery, and the establishment of network operations centers (NOC) and security operations centers (SOC), alongside custom application development and maintenance.

Xtranet Technologies allotted 39.40 lakh equity shares to anchor investors at ₹127 apiece, raising about ₹50 crore, ahead of its maiden public offering.

The Qualified Institutional Buyers (QIBs) have been allocated 75 per cent of the net offer, while 15 per cent has been reserved for the non-institutional investors (NIIs) and 10 per cent for retail investors.

The company’s shares are proposed to be listed on the BSE and NSE on July 30.

Ahead of IPO Xtranet Technologies allotted 39.40 lakh equity shares to anchor investors at ₹127 apiece, raising about ₹50 crore, ahead of its maiden public offering.

SBI Securities Valuation: Xtranet Technologies is a government-focused IT solutions provider with a strong execution track record and healthy earnings growth over FY24-26, with revenue/EBITDA/PAT registering a CAGR of 25%/83%/91%, respectively. At the upper price band of Rs 127, the issue is valued at a P/E multiple of 16.6x of FY26 earnings post-issue capital, which appears reasonable relative to peers. However, customer concentration, dependence on government contracts and a stretched receivables cycle raise concerns around the quality and durability of earnings. We therefore assign a NEUTRAL rating to IPO and would prefer to monitor cash-flow generation and execution consistency post listing.