hSenid en route as the first listed tech firm on CSE next month

Dinesh Saparamadu-led hSenid Business Solutions Ltd (hBS) is en route to becoming the first listed standalone tech and first enterprise software company on the Colombo Stock Exchange (CSE). Its LKR 692 million Initial Public Offering (IPO) is scheduled to open on 3 December 2021.

hSenid was founded in 1997 with the aim of supplying high-quality software products and services to global clientele by industry-veteran Dinesh Saparamadu. Today, hBS serves a global customer base comprising of over 1,300 clients across over 20 different industries and over 40 countries through its suite of HCM software products under both On-premise and Software-as-a-Service (SaaS) implementations. 

hSenid on the CSE

Back in September, the company submitted an application to CSE to issue 55.34 million new ordinary voting shares to the public and to get listed on the Main Board of the CSE. Following the approval of the listing application, the company is now scheduled to open the IPO on the third of next month.

Priced at LKR 12.50 per share, hBS will be offering a 20 percent ownership stake of the company to the public. NDB Investment Bank Limited (NDBIB) and CT CLSA Capital (Pvt) Limited have been appointed as joint managers to the issue.

Over the past 16 years, hSenid has been carrying out its global operations via hSenid Business Solutions (India) Pvt Ltd. which is concerned with deploying HR applications to assist HR professionals in India. Through hSenid Software (Singapore) Pte Ltd. the company is primarily involved in mobile software solutions, consultancy, and maintenance. Its PeoplesHR Australia Pty Ltd. arm provides cloud software subscription, maintenance, and consultancy services.

In addition to its direct sales efforts, hBS is in the process of bolstering its sales and distribution in the African and APAC regions via a wide-spread network of multi-tiered channel partners consisting of leading system integrators in the respective local markets

Looking to the future

Going forward hBS aims to enhance its flagship HCM software, PeoplesHR by utilizing the latest trends in IT including Data Analytics, Artificial Intelligence (AI) and Predictive Analytics, Intelligence Automation, Internet of Things (IoT), and other cutting-edge technologies. 

The company plans to invest a significant amount of IPO proceeds In acquiring small HR software companies in APEC and African Regions.  

“There are many small HR software companies within the APAC and East African regions which provide basic HR technology support to companies. These small companies support clients with HR services, core HR activities such as Payroll, Leave, Attendance, etc. Due to the diversity in HRIS requirements, many of these regions host fragmented markets with few major players. This has created an opportunity for hBS to capture and consolidate these markets through its adaptable HRIS solution. The main motive to acquire a few small companies would be for hBS to increase its market share while expanding its product and service portfolio within the region. While this move would help hBS face global competitors better, it will eliminate potential competition as well,” the Company said.

The company is expected to become LKR one billion company next year in terms of revenue.

hSenid Ventures (Private) Limited owned by Saparamadu is currently the largest shareholder of the company with a 31.10 %stake. In addition, he also direct hold a 12.56% stake in hBS.

More to come?

The government has granted a 50% tax concession for the years 2021/2022  for companies listing on the CSE before 31 December this year and to maintain a corporate tax rate of 14% for the subsequent three years upon listing, as a measure of promoting new listings on CSE.

The measure has attracted several unlisted firms to the CSE. However, only two tech firms have submitted a listing application to the CSE including hBS. Earlier this month, Sri Lanka’s leading e-commerce platform Kapruka announced an LKR 505 million IPO. 

Furthermore, local ride-hailing app PickMe has also been eyeing for a listing on CSE for some time. However, it’s yet to be materialized. In addition, digital product development firm, Arimac was also rumored to be planning an IPO on CSE.

Apart from the above, Sri Lanka-based software company WSO2 also went through a round of funding with a USD 90 million investment from the Goldman Sachs Group.