Tracxn Technologies (Tracxn) is one among the
leading market intelligence providers for private company data across sectors
and geographies. It has one of the largest coverages of private companies in
emerging technology sectors including IoT, artificial intelligence, virtual
reality, robotics, blockchain and electric vehicles (Source: F&S Report).
Tracxn has an asset light business model and
operate a Software as a Service (SaaS)-based platform. Tracxn has scanned over 662
million web domains and profiled over 1.84 million entities across 2,003 feeds
categorized across industries, sectors, sub-sectors, geographies, affiliations,
and networks globally, as of June 30, 2022. The company's platform has 3,271users
across 1,139 customer accounts in over 58 countries, as of June 30, 2022.
Tracxn offers customers private company data
for deal sourcing, identifying M&A targets, deal diligence, analysis and
tracking emerging themes across industries and markets, among other uses,
through its subscription-based platform, Tracxn. The company launched its
platform in FY2015 with a particular focus on the global emerging technology
sector, providing users with detailed profiles of companies including detailed
information of funding rounds and acquisition related information, taxonomy and
market maps, global competitor benchmarking, financial information, valuation
and capitalization tables, employee count, investor profiles, competitor
mapping, information about founders, key team and board member, company and
sector specific reports and news events. The company has since then expanded its
coverage to include 18 data modules and over 1.84 million entities, as of June
30, 2022.
The company's extensive global database of
entities coupled with customized solutions and features allows customers to
source and track companies across sectors and geographies to address their
requirements. The company is among the few private market data service provider
to have a proprietary taxonomy for technology sector companies and prepare
market maps.
The company's platform uses an in-house
developed algorithm based on a combination of technology and human analysts, to
process vast amounts of data, create profiles and provide market intelligence
on private market companies. The company's human-in-the-loop plays a strategic
role, focusing on quality assurance and addressing data and intelligence gaps
that technology alone cannot solve.
The company believes that the combination of
technology coupled with human-in-the loop has helped it to maintain a high
degree of accuracy and effectiveness while exponentially expanding its global
coverage. The company's platform includes multiple work-flow tools such as a
customizable customer relationship management (CRM) tool integrated with its
database allowing for better deal management. The platform allows
personalization for enhanced tracking and data driven insights. Its
capabilities include sourcing dashboards both locally and globally, portfolio
tracking, data intelligence and data analytics.
Over the years, the company has developed a
systematic process of sourcing data including technology-based data extraction
and instantaneous data upload through Application Programming Interface (APIs).
The company also relies on information from websites, news reports, press
releases, social media, and events to identify and track private market company
information. As part of its sourcing process, it also obtains financial and
non-financial information through automation from regulatory filings globally.
The company has an added layer of language translation that is used for
sourcing information from countries where English is not the primary language.
Clientele includes VCs, PE Funds, Merger & Acquisition (M&A), and Innovation teams of Fortune 500 companies and Investment Banks
which are using Tracxn data for daily deal sourcing, identifying M&A
targets, deal diligence and tracking emerging themes across industries and markets.
Tracxn platform is also used by various Governments, accelerators and incubators,
and universities for tracking innovative companies and sectors. The company's
customer accounts have increased at a CAGR of 30.42%, from 642 customer accounts,
as of March 31, 2020, to 1092 customer accounts, as of March 31, 2022, and
1,139 customer accounts as of June 30, 2022. The company has maintained long
standing relationships with its customers and as of June 30 31, 2022, 23.44% or
267 active customer accounts have been associated with the company for over
three years (with a maximum gap of three months between subscriptions).
The company is promoted by Ms Neha Singh and Mr Abhishek Goyal.
Ms Neha Singh holds an MTech from IIT Bombay and a MBA from Stanford
Graduate School of Business. Post pursing her graduation she worked as an
associate in Boston Consulting group and as an investment analyst in Sequoia
Capital.
Mr Abhishek Goyal has a B Tech (Computer Science) from IIT Kanpur.
He has worked in various positions in companies including yahoo, Andale, Amazon
and Accel Partners. He also founded UrbanTouch.com before Tracxn Technologies.
Operations have been supported by investments from angel investors
including Ratan Tata, the NRJN Family Trust, Neeraj Arora, Sachin Bansal, Binny
Bansal, Amit Ranjan, Girish Mathrubootham, Anand Rajaraman, Amit Singhal and
Ashish Gupta. The company received
investments from Elevation Capital, Accel Partners, Sequoia Capital, Prime
Venture Partners and KB Investments.
Object of
the offer
The offer comprises an offer for sale by selling shareholders Ms
Neha Singh of up to 76,62,655 equity shares, aggregating Rs 61.3 crore, at
upper price band, Mr Abhishek Goyal up to 76,62,655 equity shares, aggregating
Rs 61.3 crore, at upper price band, Elevation Capital up to 1,09,80,885 equity
shares, aggregating Rs 87.85 crore, at upper price band,Accel India
IV(Mauritius) Limited up to 40,17,506 equity shares, aggregating Rs 32.14 crore,
at upper price band, SCI Investments V up to 21,81,692 equity shares,
aggregating Rs 17.45 crore, at upper price band, Binny Bansal up to 12,63,096
equity shares, aggregating Rs 10.1 crore, at upper price band, Sachin Bansal up
to 12,63,096 equity shares, aggregating Rs 10.1 crore, at upper price band and
others up to 36,40,623 equity shares, aggregating Rs 29.12 crore, at upper
price band.
Ms Neha Singh
pre-issue shareholding was 25.5%, which shall decrease to 17.8% at the upper
price band of Rs 80.
Mr Abhishek Goyal
pre-issue shareholding was 25.5%, which shall decrease to 17.8% at the upper
price band of Rs 80.
Strengths:
The company is one among the leading private
market intelligence providers for private company data globally and rank among
the top five players globally in terms of number of companies profiled that
offer private market data across sectors and geographies. Its extensive global
database coupled with customized solutions and features allows customers to
source and track companies across sectors and geographies to address their
requirements. Its platform offers detailed coverage of company information that
includes company profiles, funding rounds, capitalization tables, financials
and valuation, news, team size and trends, competition mapping and information
about founders.
The company is focused on increasing the number
of entities reviewed and profiled by it. The number of entities the company
profiled on its platform has increased at a CAGR of 37.00%, from over 937,698
as of March 31, 2020, to over 1.76 million, as of March 31, 2022. As of June
30, 2022, the number of entities it profiled on its platform was over 1.84
million. In FY 2022 and in the three months ended June 30, 2022, information of
approximately an average of 1,652 and 1,275 new entities, respectively, across
various sectors was added to its platform daily. The company is also focused on
expanding the scope of information of entities profiled by the company.
The company has a diverse base of 1139 customer
accounts present in over 58 countries, as of June 30, 2022. Its customer account
base has increased by 450 customer accounts at a CAGR of 30.42% in the last
three Fiscals, from 642customer accounts as of March 31, 2020, to 1,092customer
accounts as of March 31, 2022, and further to 1,139 customer accounts, as of
June 30, 2022, due to marketing efforts and referrals by existing customers.
Some of these customer accounts are for customers that include 'Fortune 500'
companies and/or their affiliates such as Unilever Industries Private Limited.
Its global customer base helps the company limit its dependency on a specific
customer, industry or geography thereby reducing financial and concentration
risk.
Scalable and secure
technology platform conceptualized and developed in-house. The company's platform, based on a combination
of technology and human analysts, can process vast amounts of data. The company
conceptualized and developed its platform in-house, and it is designed to be
scalable and reliable providing the company flexibility to launch new features
as per its internal product road map. The platform has been designed and built
primarily using new-age technologies, for hosting on cloud infrastructure. Tracxn
is a data and market intelligence platform with over a million curated entity
profiles mapped to over 49,000 different business models, searchable in near
real-time through a set of search tools built in-house using an open search
engine and analytics solution. In addition, the company has built a range of
business and workflow tools like an inbuilt CRM tool, custom dashboard builder,
tools for sourcing, tracking companies, portfolio tracking, API support,
browser extensions, ability to save searches and provide alerts and export
tools. The company also offers enterprise grade support for customer queries
with personalized support over chat, email, and instant messaging applications.
Most of the
workforce of Tracxn operates out of India, the company, by default has a cost
advantage over its competitors based out of countries like North America and
Europe. Remuneration to services profession in India is lower than that of North
America and hence this is highly advantageous for private data provider
companies like Tracxn.Further, the company's business is technology driven,
asset light and scalable, as such enjoys high operating leverage. In the last two
years, the company’s revenue increased by 70% while cost increased by 9%.
Weakness
Failure in attracting new clients, maintaining existing clients or
expanding users within existing customer accounts will have an impact on the
company's revenue and profitability.
Revenue from operations is gained from subscription of the
platform by customers. Hence, if the customers do not renew the subscriptions,
it will hurt the revenues of the company.
Interruptions or performance problems associated with the platform
will have an adverse impact on the company's business and financial condition.
The market for private market intelligence is competitive, rapidly
evolving, and fragmented as such the company face competition from and could
lose market share to its competitors, which could adversely affect its business.
Unable to obtain and maintain accurate, comprehensive, or reliable
data, could experience reduced demand for the platform and services of the
company.
The company's success to an extent depends on its ability to
expand use of platform by customers globally and accordingly, its business is
susceptible to risks associated with international operations.
On an average 70% of the revenues were earned by overseas market
in the last 3 years as such margins are susceptible to fluctuation in foreign
exchange rates.
Use of open-source software could subject the company to face
claims challenging the ownership of open-source software and compliance with
open-source license terms.
In FYs 2020, 2021 and 2022 and in the three months ended June 30,
2021, the company had restated loss for the year / period of Rs 54.03 crore, Rs
5.35 crore, Rs 4.83 crore and Rs 0.72 crore, respectively. This was primarily
on account of fair value loss on compulsorily convertible preference shares
measured at fair value in FY 2020 and substantial expenses that the company
incurred to grow its platform and overall operations. However, the company had
restated profit for the period of Rs 0.83 crore in the three months ended June
30, 2022, any losses in future periods could adversely affect the operations
and financial conditions of the company.
Valuation
For
Q1FY2023,sales were up by 22.9% YoY to Rs 18.4 crore. Operating Profit for
Q1FY2023 stood at Rs 0.19 crore as against loss of Rs 0.62 crore in Q1FY2022. PBT
after exceptional items stood at Rs 0.84 crore against loss before tax of Rs
0.72 crore. Net Profit for Q1FY2023 stood at Rs 0.84 cr as against Net loss of Rs 0.72 cr in Q1FY2022. The company incurred exceptional loss of Rs 0.53 crore in Q1FY2022.
For
FY 2022, consolidated sales were up by 44.9% to Rs 63.45 crore. The growth in
revenues was led by healthy growth in customer accounts from 855 as on March 31,
2021, to 1092 customer accounts as on March 31, 2022. Loss from operations
declined to Rs 1.92 crore in FY2022 as against loss of Rs 17.06 crore in
FY2021. Other income was lower by 85.8% to Rs 1.7 crore. Loss before tax was lower and stood at Rs
4.85 crore as against loss before tax of Rs 5.35 crore in FY2021. Net loss
stood at 4.85 crore in FY2022 as against net loss of Rs 5.35 crore in FY2021. The
company incurred exceptional loss of Rs 4.49 crore in FY2022 related to IPO
issue related expenses.
At the
higher price band of Rs 80, the offer is made at around 11.7times EV/TTM Sales.
The
company does not have any listed peers.
Tracxn
Technologies: Issue Highlights
|
Fresh issue (in Rs crore)
|
-
|
Offer for sale (in Rs crore)
|
290.04-309.38
|
Offer for sale (in number of shares)
|
|
- in Upper price band
|
38672208
|
- in Lower price band
|
38672208
|
|
|
Price Band (Rs)
|
75-80
|
For Fresh Issue Offer size (in no of shares)
|
|
- in Upper price band
|
-
|
- in Lower price band
|
-
|
Pre issued capital (Rs crore)
|
|
Post issue capital (Rs crore)
|
|
- in Upper price band
|
10.03
|
- in Lower price band
|
10.03
|
Pre issue promoter and Promoter Group shareholding
(%)
|
50.9%
|
Post issue Promoter and Promoter Group shareholding
|
|
-On higher price band (%)
|
35.6%
|
-On lower price band (%)
|
35.6%
|
Bid Size (in No. of shares)
|
185
|
Issue open date
|
10/10/2022
|
Issue closed date
|
12/10/2022
|
Listing
|
BSE, NSE
|
Rating
|
43
|
TracxnTechnologies : Standalone Financial
|
|
2003 (12)
|
2103 (12)
|
2203 (12)
|
2106(3)
|
2206(3)
|
Sales
|
37.33
|
43.78
|
63.45
|
14.97
|
18.40
|
OPM (%)
|
-60.12
|
-38.97
|
-3.02
|
-4.14
|
1.01
|
OP
|
-22.45
|
-17.06
|
-1.92
|
-0.62
|
0.19
|
Other inc.
|
-31.02
|
11.96
|
1.70
|
0.47
|
0.68
|
PBIDT
|
-53.47
|
-5.10
|
-0.21
|
-0.15
|
0.86
|
Interest
|
-
|
-
|
-
|
-
|
-
|
PBDT
|
-53.47
|
-5.10
|
-0.21
|
-0.15
|
0.86
|
Dep.
|
0.56
|
0.25
|
0.15
|
0.04
|
0.02
|
PBT Before EO
|
-54.03
|
-5.35
|
-0.36
|
-0.19
|
0.84
|
Exceptional items
|
-
|
-
|
-4.49
|
-0.53
|
-
|
PBT After EO
|
-54.03
|
-5.35
|
-4.85
|
-0.72
|
0.84
|
Total Tax
|
-
|
-
|
-
|
-
|
-
|
Net Profit
|
-54.03
|
-5.35
|
-4.85
|
-0.72
|
0.84
|
EPS (Rs)*
|
-5.4
|
-0.5
|
-0.04
|
-0.08
|
0.3
|
EPS is
calculated based on post issue share capital of 10.03 cr at upper price band.
Face Value of Rs 1
|
Figures in
Rs crore
|
Source:
Capitaline Corporate Database
|
|