Diasoft company conducts IPO

The excitement at the latest initial offerings plays into the hands of issuers. The Diasoft company, which is currently conducting an IPO, has reduced the time for collecting applications by two days due to high demand for shares. But Kommersant’s sources are already talking about oversubscription by three to five times. However, against the backdrop of “overheating,” institutional investors are still cautious about this placement.

On Thursday, February 8, the Diasoft company announced on reducing the application period for the IPO by two days, to February 12, “due to increased interest from institutional and retail investors in the offering.” Secondary trading on the Moscow Exchange will begin on February 13. The collection of applications for Diasoft shares began on February 7, and, according to Sergei Shemyakin, head of the portfolio solutions department at Go Invest, the book was already fully signed that day. To date, according to two Kommersant interlocutors on the stock market, the book has been oversubscribed three to five times.

In 2023, the company’s revenue growth rate increased to 24% (based on data for the first half of 2023). In the first half of the year, revenue reached 3.3 billion rubles. At the end of six months of 2023, profitability was 35.4%. According to the consulting company Strategic Partners, the company holds a share of about 24% in its segment, ahead of companies such as CFT (12%), R-Style Softlab (5%), Lanit (5%), Neoflex (3%) . Diasoft plans to use the funds raised during the IPO to develop its business over the next two years. According to the new dividend policy, the company plans to allocate at least 80% of EBITDA to dividend payments on a quarterly basis in 2024–2025.

Among public companies in the sector, Diasoft is closer in size to Astra Group (capitalization – 97.9 billion rubles), but the company operates in a narrower segment of the market – in the financial sector, notes Tatyana, portfolio manager for Russian shares of General Invest Simonova.

“On the one hand, this is an advantage, since the financial sector is characterized by large-scale IT costs. But, on the other hand, it is a certain limitation, and therefore the company plans to enter new markets,” added Tatyana Simonova.

Sergey Shemyakin notes that the company is growing at a steady pace, with net profit increasing by 25% from 2021, while revenue by 30% per year. Ms. Simonova also points out that the IT sector is currently operating in extremely favorable conditions – the departure of foreign competitors and the presence of various government support measures. In addition, the majority of Russian investors cannot invest in the global technology sector, she notes.

Experts interviewed by Kommersant believe that the placement will be at the upper limit. Sergey Shemyakin does not rule out that the final oversubscription will be similar to the placement of the Astra Group (see. “Kommersant” dated October 12, 2023), where the final allocation was 4–5%. At the same time, one should not expect a significant increase in the volume of supply, since the owners do not need money (they are even ready to pay dividends), they are interested in the high valuation of the company, notes FG Finam analyst Leonid Delitsyn.

At the same time, of the four portfolio managers of large management companies surveyed, only two reported plans to submit bids. Two others said they would not participate due to the high ratings and unhealthy hype. As Mr. Shemyakin notes, Diasoft is valued at very high multiples as a growth company, and if “it fails to meet its growth plans in the future, this could significantly affect the value of its shares.” Moreover, the largest Russian banks have their own powerful IT departments and often do not actively cooperate with third-party organizations, but strive to independently develop software, which can also affect the company’s ambitious plans for growth, the expert notes.

Ksenia Kulikova, Vitaly Gaidaev