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Veranda Learning Solutions (the Issuer) is engaged in the business of offering diversified and integrated learning solutions in online, offline hybrid and offline blended formats by providing long term and short term preparatory courses for students preparing for UPSC Exams, State Public Service Commission, Staff Selection Commission, Banking, Insurance, Railways and Chartered Accountancy. The Issuer also provides these courses to employees of corporates through B2B offerings. The Issuer provides services primarily to companies in Technology, CPG and Retail, Industrials, and BFSI industries. It has emerged as one of the most trusted partners to several Fortune 500 companies in recent years and has worked with over 30 Fortune 500 companies in the last three fiscals. Some of the Issuer’s key clients include Adobe, Uber Technology and 7-Eleven.
It started its operations in December 2020 and during 9MFY22, 42,667 Students and professionals have enrolled across all courses, being 16,793 in offline models and 25,874 in online model. The Issuer employed 8 Student advisors, 166 Mentors and operated 25 PDCs across 25 cities and towns and 2 states.
As of December 31, 2021, the Issuer had 431 employees on payroll and 400 outsourced employees. Its team includes Mentors, Student Advisors and non-teaching staff including content team to administer business operations such as coordinating classrooms, database and specific-marketing activities.
The Issuer offer its services through its four Wholly-Owned Subsidiaries which are-
The Issuer provides learning solutions through the below models:
The financial outlook of the Issuer does not has a track record as the company is a new start up and started its operations in the year 2020. The company has not break even and has posted a loss of Rs 18.27 crore on its revenues of Rs 15.66 crore for H1FY22 and loss of Rs 8.28 crore for FY21. The Issuer has borrowings of Rs 215.80 crore which is at a higher side and converts to debt to equity of 9.5x.
Title | H1FY22 | FY2021 |
Total Revenue | 15.66 | 2.54 |
PAT | -18.27 | -8.28 |
EBITDA | -15.05 | -7.62 |
Total Assets | 307.37 | 11.52 |
The company has no listed peers as per the RHP but the Issuer has many rivals like BYJU’s, Upgrad, Vedantu, Unacademy amongst other players. The valuation of the company is unascertainable as the company is incurring losses.
Veranda Learning Solutions IPO amounting to Rs 200 crore opens on 29th March with price band of Rs 130-Rs137 per share. The retail quota is 10% with minimum lot size of 100 shares (Rs 13700). The offer closes on 31st Mar 2022 and is expected to list on 7th April. Objects of the offer are to repayment of certain borrowings (Rs 60 crore), payment of acquisition consideration of Edureka (Rs 25.19 crore) and growth initiatives (Rs 50 crore).
Veranda Learning is a provider of diversified courses which includes competitive exam courses, professional courses, short term upskilling and reskilling courses. The Issuer has grown through collaborations and acquisitions in the last year with acquisition of Race academy and recent being Edureka. Edureka has a strong presence; it has customers based overseas, including many customers from the United States and United Kingdom. With the acquisition of Edureka, the Issuer has access to international markets like US and UK and will continue to expand its overseas customer base. The Issuer has weak financials; it is yet to establish its track record and seems to be in a very nascent stage for IPO. Hence it is advisable to skip and avoid this IPO.
Review By CA Priyanka Choudhary on 23rd Mar 2022
About CA Priyanka Choudhary
Priyanka Choudhary Jain is a Chartered Accountant and an experienced credit analyst. She has worked with CRISIL as Senior Credit Analyst on ratings assignments including business and financial analysis in Corporates as well as the Public Finance Sector.
Email: [email protected]
DISCLAIMER: No financial information whatsoever published anywhere here should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is purely for educational and information purposes only and under no circumstances should be used for making investment decisions. Readers must consult a qualified financial advisor prior to making any actual investment decisions, based on information published here. Any reader taking decisions based on any information published here does so entirely at own risk. Investors should bear in mind that any investment in stock markets are subject to unpredictable market related risks. Above information is based on RHP and other documents available as of date coupled with market perception. Author has no plans to invest in this offer.