CIEL HR Services Files Draft Papers for IPO

Chennai-based CIEL HR Services, known for its tech-driven human resource solutions, is ready for its IPO. The company has filed its draft red herring prospectus (DRHP) with SEBI to raise funds through a mix of a Rs.335 crore fresh equity issue and an offer-for-sale (OFS) of 47.39 lakh shares by existing shareholders, including its promoters.

IPO Details & Pre-IPO Plans

The promoters, Aditya Narayan Mishra (CEO), Santhosh Kumar Nair (COO), and Doraiswamy Rajiv Krishnan (Executive Director) currently hold 87.02% of the company. CIEL HR is also exploring a pre-IPO placement to raise Rs.67 crore. If this goes through, the fresh issue size will be reduced accordingly.

Where the Funds Will Go

The company plans to allocate Rs.100 crore from the IPO proceeds for incremental working capital requirements. Additionally, Rs.40.7 crore will go towards increasing stakes in its subsidiaries, such as Firstventure Corporation, Integrum Technologies, and Thomas Assessments. Another Rs.55.2 crore will be invested in subsidiaries like Ma Foi Strategic Consultants and Next Leap Career Solutions to expand their learning platforms. The remaining funds will be used for inorganic acquisitions and general corporate purposes.

Financials

CIEL HR’s numbers have turned around impressively. It reported a consolidated profit of Rs.10.85 crore in FY24, bouncing back from a Rs.3.2 crore loss in FY23. Revenue also saw a 35.8% jump, reaching Rs.1,085.7 crore. In Q1FY25, it earned Rs.3.2 crore profit on Rs.325.2 crore revenue.

Industry Position & Competitors

CIEL’s asset-light business model and focus on acquisitions have strengthened its position in the HR solutions space. The company competes with names like Quess Corp, TeamLease Services, and Spectrum Talent Management in an industry growing at a CAGR of 18.1% between FY21 and FY24.

Conclusion: With its IPO plans in motion and a growth trajectory set, CIEL HR Services looks ready to expand its operations and further establish itself as a competitive player in the HR solutions market.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.