All you need to know about

PROTEAN eGOV TECHNOLOGIES LIMITED

Face Value: Issue Size: Price Band

INR 10 INR 4,903. 27 MN
INR
Bid Lot & Size: Issue Type:
18 E Q U I T Y SHARES 100% B O O K B U I L D I N G 752-792

Issue Opens: 06 Nov 2023 | Issue Closes: 08 Nov 2023

Post money market cap of ₹32,033.81 mn at upper price band

Shareholding Pre IPO Post IPO Share

Net issue (%)
(%) Reservation

Promoter and 0% 0% QIB 50

Promoter Group
NII 15
100% 100%
Public Retail 35

*Source: RHP

Issue Company Leadership

Managers
Suresh Kumar Managing Director and
IIFL Securities Limited, ICICI Sethi CEO
Securities Limited, Equirus Capital
BRLMs Private Limited, Nomura Financial Jayesh Waman Whole-time Director and
Advisory and Securities (India) Private Sule COO
Limited
Sudeep Bhatia CFO
Link Intime India Private Limited Chief product &
Registrar Bertram D’Souza
innovation officer

This document summarizes a few key points related to the issue and should not be treated as a comprehensive summary. Investors are
requested to refer to the Red Herring Prospectus for further details regarding the issue, the issuer company and the risk factors before
taking any investment decision. Please note that investment in securities is subject to risks including loss of principal amount and past
performance is not indicative of future performance. Nothing herein constitutes an offer of securities for sale in any jurisdiction where it
is unlawful to do so. This document is not intended to be an advertisement and does not constitute an invitation or form any part of any
issue for sale or solicitation of an offer to subscribe for or purchase any securities and neither this document nor anything contained herein
shall form the basis for any contract or commitment whatsoever. IIFL Research: E-mail - research@iifl.com
 Company Overview

• Protean eGov Technologies Limited is one of the key IT-enabled solutions companies in India
(Source: CRISIL Report). It is engaged in conceptualizing, developing and executing nationally
critical and population scale greenfield technology solutions.
• It collaborates with the government and has extensive experience in creating digital public
infrastructure and developing innovative citizen-centric e-governance solutions.
• The company was originally setup as a depository in 1995 and created a systemically important
national infrastructure for capital market development in India. It has been the chief architect and
implementer for some of the most critical and large-scale technology infrastructure projects in
India (Source: CRISIL Report).
• Its solutions have led to identification of bottlenecks in government services, increased
transparency and efficiency, redefined delivery of public services and has led to a reduction in
service delivery costs.
• The company is among the leading Indian companies in the e-governance sector in terms of
profitability, operating income, operating profit and operating profit margin in Fiscal 2023
(Source: CRISIL Report).
• It is a professionally managed company and is led by an experienced senior management team
whose expertise and industry experience have helped it grow its operations and innovate its
services. Since inception and as of June 30, 2023, the company has implemented and managed
19 projects spread across seven ministries and autonomous bodies ushering change in public
delivery of services.
• It has been instrumental in establishing public digital infrastructure and creating e-governance
interventions impacting multiple sectors of the Indian economy. Project-wise major highlights
and its market share are as below:
 Objects of the Offer
The Offer comprises of an offer for sale of 6,191,000 Equity Shares. The objects of the Offer are to
(i) carry out the Offer for Sale of up to 6,191,000 Equity Shares and (ii) achieve the benefits of listing
the Equity Shares on the Stock Exchanges.

Consistent Track Record of Financial Performance

The company’s revenue from operations has increased from ₹6,031.32 million in Fiscal 2021 to
₹7,422.06 million in Fiscal 2023. The company’s Adjusted EBITDA increased from ₹848.45 million
Fiscal 2021 to ₹1,179.64 million in Fiscal 2023. PAT increased from ₹921.87 million in Fiscal 2021
to ₹1,070.42 million in Fiscal 2023.

Fiscal Fiscal Fiscal June

(₹ in million) 2022 June 2023
2021 2022 2023
Revenue from 6,909.09 1,567.48
6,031.32 7,422.06 2,204.03
Operations
Adj. EBITDA 848.45 1,238.34 1,179.64 216.77 340.88
Adj. EBITDA Margin 14.07% 17.92% 15.89% 13.83% 15.47%

PAT 921.87 1,439.37 1,070.42 212.71 322.11

13.57%
PAT Margin 15.28% 20.83% 14.42% 14.61%

EPS 23.02 35.78 26.50 5.27 7.97

ROCE 16.93% 22.91% 16.13% 3.29% 4.60%

Competitive Strengths

Pioneer and market leader in universal, citizen centric and population

scale e-governance solutions
Protean eGov Technologies Limited is among the few players in India which are working towards
creation of open digital ecosystems. For example, it is one of the key and early contributors to the
open source community and protocols that are powering ONDC. (Source: CRISIL Report) It is among
India’s top IT-enabled e-governance service providers in terms of profitability and operating income in
Fiscal 2023. (Source: CRISIL Report) It continues to be a market leader in provision of e-governance
services such as management of the TIN, PAN processing, NPS and Atal Pension Yojana. (Source:
CRISIL Report). The company has demonstrable experience in implementing and managing
population scale critical solutions, and since inception and as of June 30, 2023, it has developed and
implemented 19 projects across seven ministries across India. It is amongst the few private players in
India in e-governance space working towards the achievement of Digital India initiative and creation
of open digital ecosystems by leveraging open source technologies, across variety of sectors such as
e-commerce, mobility, healthcare, agriculture and education amongst others. (Source: CRISIL
Report). Its primary engagement has been with following ministries:
Secure, scalable and advanced technology infrastructure
Protean eGov Technologies Limited has made investments in technology platforms that in its
experience has strengthened its competitive advantage, increased its operating leverage, ensured
scalability and improved functionality while driving innovation. These investments have also helped it
to provide its clients and other stakeholders with bespoke services. The company’s market-first
innovations have been consistently implemented across various sectors and products such as TIN in
taxation, pilot infrastructure for GST which laid out the foundation for the roll-out for a unified tax
accounting system in India. It is actively contributing to and supporting open digital building blocks
using open source technology and protocols that powers ONDC for use cases in sectors like e-
commerce, mobility and open finance As of September, 2023, ONDC is live in 400+ cities in alpha
phase and seven (7) cities in beta/test phase. Difference in alpha and beta phases is that more focus
and marketing efforts are done in the beta phase. ONDC has onboarded about 1.79 lakh
sellers/service providers across the country with 47 network participants gone live. (Source: CRISIL
Report)These network providers are buyers’, and seller applications and logistics providers. (Source:
CRISIL Report) The company has developed scalable platforms by adopting a differentiated
technology-centric approach focusing on increasing security and risk mitigation to help drive growth.
Additionally, its platforms require limited capital expenditure to scale when it adds new offerings or
when volumes increase allowing us to offer seamless and efficient services to users.

Diversified, granular and annuity based service offerings

Protean eGov Technologies Limited’s diversified service offerings are spread across sectors such as
tax administration, pension record keeping solutions, national identity and identity authentication
solutions, education and skill financing solutions. Its offerings cater to multiple target groups and
customer segments including businesses and retail consumers apart from the government, ensuring
low concentration risk. For example, under business-to-business, it has implemented e-KYC and e-
Sign as a service. While under business-to-consumer services we have PAN enrolment. Under
business-to-government services it has services like TIN and NPS.
Large physical infrastructure with pan-India network and scale resulting
in inclusion
Protean eGov Technologies Limited has developed a pan-India service delivery network across India
for various public and other services provided by it. Its service network has grown over the years and
grew from 33,041 centres, as of March 31, 2021 to 53,948 centres, as of March 31, 2022, 74,435
centres as of March 31, 2023 and further to 79,374 centres, as of June 30, 2023. As of June 30, 2023,
its PAN and TIN facilitation centres network was in over 12,000 PIN codes spread across over 700
districts in India. In addition, as of June 30, 2023, it covered over 26,000 nodal offices of the central
government, over 263,000 nodal offices of state governments and had over 87,000 points of presence
across India for the administration of the NPS. As of June 30, 2023, it operated 7,121 TIN facilitation
centres across 1,652 locations accepting various statements from tax payers including tax deducted
at source, tax collected at source, annual information returns and statement of specified financial
transactions through its network. The company has expanded its TIN network from 5,956 TIN
facilitation centres, as of March 31, 2021 to 6,988 TIN facilitation centres, as of March 31, 2023.
Further, in order to expand its last mile geographical reach, it has entered into partnerships with
distribution networks such as Nearby Technologies Private Limited, Fino Payments Bank Limited,
Vakrangee Limited and Payworld Digital Services Private Limited among others.

Strategies Going Forward

Diversify its offerings with a focus on new sectors

Protean eGov Technologies Limited has been involved at multiple nodes of the Aadhaar value chain
starting from enrolments to digital transactions creating digital public infrastructure and providing
enabling solution to the Aadhaar ecosystem (Source: CRISIL Report). It intends to extend its
experience in implementing large scale time critical and data intensive project like Aadhaar to diverse
sectors with the specific focus on health, education and agriculture. The company intends to leverage
its capabilities as an ecosystem creator to conceptualize, design and implement large-scale
e-governance projects. It intends to position itsef as an enabler of digitalization to create sustainable
public digital infrastructure across sectors and continue to invest in improving its existing technology
systems or implement new, more advanced technology systems that may be developed. The sectors
targeted are in the areas such as;

Healthcare: With its extensive service network, the company intends to focus on various aspects of
technology services in the health care sector such as enabling the ecosystem with Health IDs (ABHA
IDs), enabling digitization and upload of health records, enabling download and viewing of electronic
health records, clinic automation, practice management, tele-medicine, and vaccine administration
and management. Specific solutions in these areas are intended to be built using latest and open
source technologies in accordance with the NDHM vision which will enable it to remain ahead of the
curve and to be competitive.

Education and Skilling: The National Digital Education Architecture (“NDEAR”) has been conceived
by Government of India as a unifying national digital infrastructure to energise and catalyse the
education ecosystem. It is federated, unbundled, interoperable, inclusive, accessible, evolving which
aims to create and deliver diverse, relevant, contextual, innovative solutions that benefit students,
teachers, parents, communities, administrators and result in timely implementation of policy goals
(Source: CRISIL Report).

Agriculture: Protean eGov Technologies Limited’s focus in the agri-tech space involves
implementation of technology initiatives for creation of information interfaces enabling seamless
access to farmer information and other agri-related data points for providing value added services.
These services are inter-linked and considered essential for the overall development and profitability
of the agriculture sector. (Source: CRISIL Report) The company intends to leverage its existing
competencies and investments in building blocks used in other open digital ecosystems for capacity
building in agriculture and leverage other open platforms and protocols such as OCEN, ONDC and
Beckn to create e-marketplaces and provide access to agriculture credits through a one-stop solution.

Building capability around data analytics, digital verification and due

diligence
Protean eGov Technologies Limited has a track record of successfully implementing and managing
large and critical applications and databases and developing solutions that offer operational efficiency
and productivity. Leveraging on this experience, the company intends to build core capabilities around
data led businesses. In view of the above opportunities, it has formed two new subsidiaries as
represented below:
These opportunities enable it to build on its strength of managing and monitoring large databases
and build offerings around data led businesses such as;

Account Aggregator: Protean eGov Technologies Limited intends to leverage its relationships with
financial information providers such as banks, NBFCs, insurance companies and asset management
companies to offer account aggregator and data analytics services that will help offer digitized
financial services and promote greater financial inclusion. It intends to use technologies like artificial
intelligence, machine learning, and advanced analytics to build intelligent AA solutions that deliver
inclusion and can potentially evolve to provide services such as lending, wealth management and
personal financial management that have, thus far, been availed of largely by the affluent strata.

Digital verification and due diligence: The company has developed credible business intelligence
solutions by consolidating its existing offerings like online PAN verification, e-KYC, GST verification
and integrating with other such verification solutions and delivering products designed to identify
frauds, make credit appraisal seamless and monitor financial transactions swiftly and securely. Its
APIs integrate with existing client systems to offer customizable solutions as per requirements.

Cloud Services: Protean eGov Technologies Limited has setup cloud services with a view to extend
its experience of managing infrastructure and data to enterprises and market as a whole. It has
collaborated with Vigyanlabs Innovations Private Limited, a technology innovator in AI driven
computing and holder of global patents, to roll out cloud services in India, including but not limited to
Infrastructure-as-a-Service (IaaS) and Platform-as-aService (PaaS). The company anticipates a large
opportunity to expand its portfolio of cloud services to its existing corporate clients, particularly those
in the BFSI segment.
Cyber Security: The company intends to focus on the consulting and advisory service models in the
cyber security industry. It intends to cater to government organizations and small and medium
enterprises with services such as Gap assessment, development of effective cyber security
strategies, design / strengthen security architecture, security assessment, audit and awareness
training. It also intends to help establish robust governance, risk and compliance processes and
necessary cyber security policy development.

Expanding into newer geographies

Given its expertise in handling a range of IT/ ITES projects and its ability to provide diversified services
and solutions, Protean eGov Technologies Limited intends to offer its services selectively in
jurisdictions outside India. It will look to leverage its expertise of working and developing projects for
the Indian government to similar projects in countries where it is currently evaluating projects.
Considering this expertise, the Ministry of External Affairs, Government of India has enlisted the
Company under its “Development Partnership Frameworks” to promote India’s capabilities globally.
The Ministry of Health and Family Welfare, Government of India has made the CoWIN (an open
source platform) available to different countries for managing vaccinations and has empaneled the
Company as an IT Services firm for customization, implementation and roll out of CoWIN for
countries. It may also consider selective acquisitions and investments that will complement its existing
infrastructure and service offerings.

Adoption of disruptive technologies and investment in open source

solutions, protocol and networks
Protean eGov Technologies Limited recognizes that it is evolving towards collaborative ecosystems
and are striving to be one of the main contributors in creating and building ‘Open Digital Ecosystems’
across sectors which would be transparent, secure and enable a community of actors to unlock
innovative, disruptive and transformative solutions for society, based on a robust governance
framework. With this vision and a clearly identified business potential, it has already invested in
developing Centres of Excellence for open source technologies and would continue to focus and
invest further so as to build and allow products and services which would be built for digital public
good. It envisions to be the main contributors and enablers in building sustainable and innovative
technology solutions ensuring inclusivity, ease of access and fair pricing structure.
 Management

• Suresh Kumar Sethi (Managing Director and Chief Executive

Officer): He holds a bachelor’s degree in engineering in electronics and electrical from
Panjab University, Chandigarh. He holds a master’s degree in business administration from
the University of Delhi. He has over three decades of experience in the financial services
industry with financial services companies such as Citigroup, YES Bank and Vodafone M-
Pesa across India, Kenya, UK, Argentina, and USA. Prior to this role, he was the managing
director and chief executive officer of India Post Payments Bank.

• Jayesh Waman Sule (Whole-time Director and Chief Operating

Officer): He holds a bachelor’s degree in commerce from the University of Bombay. He is
a member of the Institute of Chartered Accountants of India. He was previously associated
with NSDL and has over two decades of experience in capital markets and IT-enabled
services.

• Sudeep Bhatia (Chief Financial Officer and Executive vice

president): He has passed the final examination conducted by the Institute of Cost and
Works Accountants of India and Uniform CPA Examination. He is a member of the Institute
of Chartered Accountants of India. He has over 20 years of experience and was previously
associated with Infrastructure Leasing & Financial Services Limited, UL Canada Inc.,
Genpact India, Citi Financial Consumer Finance India Limited, Tata Capital Limited, Religare
Macquire Wealth Management Limited, Macquaire Global Services Private Limited and
Electronica Finance Limited.

• Bertram D’Souza (chief product & innovation officer): He holds diploma

in computer technology by Board of Technical Examinations, Maharashtra State and has
completed online programme on building digital partnerships and ecosystems from INSEAD.
He was previously associated with IntrasoftTech India Limited, Atom Technologies Limited,
Venture Infotek Global Private Limited, Tata Communications Payment Solutions Limited,
Vodafone Mpesa Limited and Kotak Mahindra Bank Limited and has over 17 years of
experience.
 Risks

• The company is substantially dependent on projects awarded by government

entities and agencies and its relationship with GoI entities exposes it to risks
inherent in doing business with them.
• The company’s reputation could be at risk, and it may be liable to its clients or to
regulators for damages caused by inadvertent disclosure of confidential
information and sensitive data.
• It may not be able to provide business solutions that meet its clients’
requirements, which could lead to clients discontinuing their work with it, which
in turn could harm its business.
• The company’s client contracts can typically be terminated without cause, which
could negatively impact its revenues and profitability.
• If its pricing structures do not accurately anticipate the cost, complexity and
duration of its work, then its contracts could be unprofitable.

For complete list of risk factors kindly refer to the Red Herring Prospectus.
Disclaimer:

IIFL Securities is involved in the initial public offering of Protean eGov Technologies Limited, in the capacity of a Book
Running Lead Manager and a Syndicate Member to the Issue. However, IIFL Securities Limited shall not be in any way
responsible for the contents hereof, any omission there from or shall not be liable for any loss whatsoever arising from
use of this document or otherwise arising in connection therewith, including with respect to forward looking statements,
if any. IIFL makes no representation/s or warranty/ies, express or implied, as to the contents hereof, accuracy,
completeness or reliability of any information compiled herein, and hereby disclaims any liability with regard to the same.
Neither IIFL Securities Limited nor any of its affiliates, group companies, directors, employees, agents or representatives
shall be liable for any damages whether direct, indirect, special or consequential including lost revenue or lost profits that
may arise from or in connection with the use of the information. You shall verify the veracity of the information on your
own before using the information provided in the document. Investors are requested to review the prospectus carefully
and obtain expert professional advice.

IIFL Group | IIFL Securities Ltd (CIN No.: U99999MH1996PLC132983) IIFL House, Sun Infotech Park, Road No. 16V, Plot
No. B-23, MIDC, Thane Industrial Area, Wagle Estate, Thane - 400604. Tel.: (91-22) 2580 6650 *Customer Service:
40071000 *Stock Broker SEBI Regn: INZ000164132 *NSE: 10975 *BSE: 0179 *MCX:55995 *NCDEX:378 *Depository:
INDP185 2016 *MF Distributor ARN: 47791, *PMS SEBI Regn.: INP000002213, *Investment Adviser SEBI Regn. :
INA000000623, *Research Analyst SEBI Regn:- INH000000248 | Kindly refer to www.indiainfoline.com for detailed
disclaimer and risk factors.

For Research related queries, write at research@iifl.com

For Sales and Account related information, write to customer care: cs@iifl.com or call on 91-22 4007 1000