C.E. Info systems limited - IPO Note


C.E. Info systems limited - IPO Note


Price range
Rs. 1000 - 1033
Issue Period:
Dec 09, 2021
Dec 13, 2021
December 08, 2021

Stock Info

CNX Nifty
Face value (Rs.)
Market lot
Issue size
Rs. 1,040 cr.
Public Issue
1.0 cr. shares
Market cap post IPO
5,500 cr.
Equity Pre - IPO
10.6 cr.
Equity Post - IPO
10.6 cr.
Issue type
Offer For Sale

Shareholding (Pre IPO)

Source: Ace equity, StockAxis Research

Shareholding (Post IPO)

Source: Ace equity, StockAxis Research

Key Strengths & Strategies

Market Leader in B2B and B2B2C segment

  • MapmyIndia has an early mover advantage for adopting digital mapping in India and pioneering several digital mapping technologies thereafter. It holds a leading market position in B2B and B2B2C markets for digital maps and location intelligence technologies & services.
  • MapmyIndia’s digital maps cover 6.29 Mn km of roads, representing 98.50% of India’s road network. It covers 7,933 towns, 6,37,472 villages, 17.79 Mn places across many categories such as restaurants, retail shops, malls, ATMs, hotels, police stations, electric vehicle charging stations etc., and 14.51 mn house or building addresses.
  • It derives majority of its revenue from B2B and B2B2C enterprise customers. Its business model is to charge its customers fees per period based on per vehicle, per asset, per transaction, per use case, per user, as applicable. These take the form of subscription fees, royalties, annuities in return for providing licenses and usage rights to its proprietary digital MaaS, PaaS and SaaS offerings. Subscription fee, royalty and annuity payments together contributed over 90% of its revenue from operation for Fiscal 2021.

Network effect and Technology is helping them to build strong entry barriers

  • MapmyIndia’s innovations in digital maps and geospatial solutions specifically localized for a challenging geography such as India, have helped them to build a moat and create strong entry barrier for companies.
  • New geospatial guidelines also give a competitive edge to partner with global brands for providing navigation related services within India. Its map offerings are strategically integrated and connected to provide continuous feedback loop that create a network effect, further enhancing freshness of data and improving customer experience. Its hyperlocal responsiveness has most recently been utilized in the context of emergency response for pandemic in India via official government CoWIN app.

Marquee customers across sectors

  • MapmyIndia’s customers operate in a wide variety of industry sectors which helps to augment its offerings as well as target new customers across different industries.
  • Many of its customers are leading market players and renowned brands in their respective fields such as Hyundai, MG Motor, PhonePe, Flipkart, GSTN, AVIS, Safexpress, Airtel, HDFC Bank, Yulu etc. High retention of existing customers is driven by MapmyIndia’s ability to provide new use cases and new solutions to meet evolving needs.
  • MapmyIndia’s ‘customer first’ approach has helped them in developing strong and long-standing customer relationships. It typically enters into long-term contracts of 3 to 5 years’ which are mutually renewable, thereby providing continued synergy and revenue predictability.


Higher dependence on cyclical automotive sector
MapmyIndia’s business is significantly dependent on automotive sector (52.5% of revenue in FY21). Revenue from automotive sector is cyclical and periodic fluctuations in overall demand for vehicles could result in fluctuations of demand for company’s products and services.

Client concentration
As of FY21, top 25 customers represented 80% of revenues from operations any loss of key customers or reduction in demand from these customers could adversely affect the business. Also, if customers do not enter in to new high-growth segments, MapmyIndia might not be able to capitalize on new growth opportunities.

liberalization may increase competitive intensity
The liberalization of the digital mapping industry may increase competitive intensity and it can result in the loss of customers and market share. It can lead to pricing pressures from other companies, including multinational companies for few or most of its offerings. Such increase in competition can affect its long‐term profitability.

Entire issue is an OFS, the company will not get any proceeds from this IPO
Growth in revenue over last 3 years (FY19 to FY21) is meagre although gross margin & EBITDA margin is quite impressive. In view of further liberalization & benign regulatory environment in future competition is going to only increase which imply top line growth will be a challenge.

Company Description

C.E. Infosystems (MapmyIndia) is a data and technology products and platforms company offering proprietary digital maps as a service (MaaS), software as a service (SaaS) and platform as a service (Paas). It is India’s leading provider of advanced digital maps, geospatial software and location-based IoT technologies.

Operating under the brand MapmyIndia (for Indian market) and Mappls (for international market).

It serves marquee and renowned companies across different industries. Some of the key clients include: PhonePe, Flipkart, Yulu, HDFC Bank, Airtel, Hyundai, MG Motor, Avis, Safexpress and Goods and Service Tax Network (“GSTN”).

The company primarily service enterprise customers across 3 major categories:

  1. corporate
  2. automotive
  3. government and their customers

In addition, they also offer professional grade maps and products directly to retail customers, through

their ‘Move’ app and GPS IoT enabled gadgets and devices.

As of September 30, 2021, they had serviced over 2,000 enterprise customers since their inception. In Financial Year 2021, they had over 500 customers on their platforms.

Some of their customers include PhonePe, Flipkart, Yulu, HDFC Bank, Airtel, Hyundai, MG Motor, Avis, Safexpress and Goods and Service Tax Network (“GSTN”).

MapmyIndia’s operations are centrally located in India, with an office in United States and partner representation in Japan. As on FY21, the company had combined workforce of 734 employees, comprising of 410 permanents and 324 non-permanent employees with an average age of ~32 years.


MapmyIndia’s revenue stood at Rs. 1,525 Mn in FY21 (2.3% Y-o-Y, resilient despite COVID impact) with EBITDA margin of 35%. Order book has grown at strong rate of 82% CAGR over FY19-21 indicating strong revenue growth ahead. Cash conversion is strong with OCF/PAT at 140%/115% in FY20/21 and ROE is healthy at 17% in FY21.

At the upper price band of Rs 1033, the PE works out to be 94x to its FY21 earnings. If we annualize FY22 earnings and attribute it to its post-issue paid-up equity capital, then the asking price is at a P/E of around 59x.

The company has leading position within marquee client base, strong moat resulting from most comprehensive and innovative solutions, specifically localized for challenging geography of India, solid network effects resulting from continuous feedback loop in digital mapping, asset light business model with high operating leverage. Hence, we recommend SUBSCRIBE to the IPO for long term perspective.

Key Information

Use of Proceeds:
The IPO consists of an offer for sale (OFS) of 10,063,945 shares. There is no Fresh Issue.

  • The major selling shareholders include promoter Rashmi Verma, who will offload up to 4,251,044 shares.
  • Japanese mapping major Zenrin, which holds an 8.78% stake or 4,673,719 shares, will sell up to 1,369,961 shares in the IPO.
  • Qualcomm Asia Pacific Pte. Ltd – will sell up to 2,701,407 Equity shares.

Book running lead managers:
Axis Capital Limited ICICI Securities Limited Nomura Financial Advisory And Securities (India) Pvt Ltd

Rakesh Kumar Verma is the Chairman and Managing Director of the company. Has significant experience as an entrepreneur in the field of digital maps and geospatial information technologies. Rohan Verma is the Whole-time Director and CEO of the company. He has experience as an entrepreneur in the digital mapping, geospatial technologies and automotive mobility technologies. Mrs. Rashi Verma is the co-founder and chief technology officer of the Company.

Financial Statement

Profit & Loss Statement:- (Consolidated)

Particulars (Rs. in Crores) FY19 FY20 FY21
Revenue from Operations 135.26 148.63 152.46
COGS 19.85 14.56 16.39
Gross Profit 115.41 134.07 136.08
Gross Margin (%) 85.32% 90.20% 89.25%
Employee Benefit Expenses 50.75 64.27 53.95
Other Expenses 39.15 40.44 30.71
EBITDA 25.50 29.35 51.41
EBITDA Margin (%) 18.86% 19.75% 33.72%
Depreciation 9.15 9.76 9.90
EBIT 16.35 19.59 41.51
EBIT Margin (%) 12.09% 13.18% 27.23%
Finance Cost 2.63 2.84 2.56
Oher Income 28.08 14.85 39.81
Profit Before Tax 41.80 31.61 78.77
Tax 8.24 8.40 19.33
Effective Tax Rate (%) 19.70% 26.58% 24.54%
Profit After Tax 33.57 23.20 59.43
PAT Margin (%) 24.82% 15.61% 38.98%
Earnings Per Share (Rs.) 6.19 4.27 10.99