Jaro Institute IPO — Price Band, Issue Details, Financials, Risks And More: Read Anand Rathi's Report

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Anand Rathi Report

Jaro Institute of Technology Management and Research Ltd. will launch its initial public offering on Sept. 23 and concludes on Sept. 25. The company has set the price band at Rs 846 to Rs 890 per equity share.

Investors can place bids starting from a minimum of 16 shares and in multiples thereafter.

The Rs 450-crore IPO is a combination of a fresh issue of Rs 170 crore and an offer for sale of 0.31 crore shares aggregating to Rs 280 crore.

Nuvama Wealth Management Ltd., Motilal Oswal Investment Advisors Ltd., Systematix Corporate Services Ltd., Bigshare Services Pvt. Ltd. are the book-running lead managers for the public issue.

Objects of the Issue

1. Repayment of certain borrowings availed by the company.  Marketing, brand building and advertising activities.

2. General corporate purposes.

Strengths:

• Market leading position in online higher education and upskilling space with strong brand image and pan-India presence.

• Comprehensive solutions to Partner Institutions and Learners.

• High revenue predictability backed by long-lasting, robust client relationships.

Key Strategies:

• Expand market share through broader portfolio of offerings and extensive network of partnerships.

• Continue marketing, brand building and advertising activities, diversify online presence, and increase Learner enrolments and scalability of business.

• Expand their geographical footprint by setting up additional offices, learning centres and immersive studios in locations across India and increasing outreach to Learners.

• Continue to enhance digital capabilities and platforms with a focus on enhancing client satisfaction, operational efficiency and cost optimization.

• Enhance Learner experience and lead generation through freemium offerings and counselling tools.

Valuation:

Jaro Institute of Technology Management and Research holds a leading position in the online higher education and professional upskilling sector, supported by a strong brand reputation and a wide pan-India presence. The company provides comprehensive solutions that cater to both Partner Institutions and Learners, enabling academic and career growth.

With a consistent track record of building long-term and resilient client relationships across industries, it ensures high revenue visibility and stability. Its portfolio reflects a proven ability to design and deliver highquality, diverse course offerings tailored to evolving market needs.

By leveraging advanced technology and digital platforms, Jaro enhances the overall experience for its clients while driving scalability and expansion.

The company’s commitment to innovation and service excellence positions it as a trusted partner in the education ecosystem.

At the upper price band company is valuing at P/E of 38.1x to its FY25 earnings, with EV/Ebitda of 24.8x and market cap of Rs 19,719 million post issue of equity shares. We believe that the IPO is fully priced and recommend a “Subscribe-Long Term” rating to the IPO.

Key Risk:

While the name of company is “Jaro Institute of Technology Management and Research Ltd.”, company do not create the academic content or independently offer the degree programs and certification courses by themselves. Business depends heavily on their Partner Institutions as they are responsible for the academic content of their degree programs and certification courses, which they market and facilitate delivery of. If there is any decline in the adoption by their Partner Institutions of online delivery of their degree programs and certification courses, their business, revenues, profitability and growth may suffer.

Company derive a significant portion of their revenues from a few Partner Institutions and the loss of one or more such clients could adversely affect their business and prospects.

Company’s business depends heavily on the adoption by colleges and universities of online delivery of their degree programs and certification courses. If their existing or prospective Partner Institutions continue with on-campus degree programs or certification courses due to their perceived loss of control over the education experience, their revenue growth and profitability may suffer.

Company have negative cash flows in the past. Their historical performance may not be indicative of their future growth or financial results.

One of the objects of the Offer is to undertake marketing, brand building and advertising activities. Such utilisation may not achieve the desired results and the outcome of activities is not ascertainable at this stage.  Market capitalisation to total revenue from operations ratio, market capitalisation to tangible assets ratio and enterprise value to Ebitda ratio may not be indicative of the trading price of their Equity Shares upon listing on the Stock Exchanges subsequent to the offer and, as a result, you may lose a significant part or all of your investment.

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