Avanceon's Octopus Digital set for IPO after PSX, SECP approves listing application

Maintaining its momentum of initial public offerings (IPO), Pakistan is set to see the listing of Octopus Digital Limited, a 100% wholly-owned subsidiary of Avanceon Limited.

In a notice sent to the Pakistan Stock Exchange (PSX) on Friday, Avanceon said that the Security and Exchange Commission of Pakistan (SECP) and the PSX have approved the listing application of Octopus Digital Limited.

The notice added said that the Prospectus issuance/Book Building/and Retail IPO dates of Octopus Digital shall be announced subsequently.

Octopus Digital will be the first technology company to conduct an IPO in Pakistan in more than seven years, stated the notice. The company intends to offer 27.35 million ordinary shares through the IPO.

“Octopus Digital, a 100% wholly-owned subsidiary of Avanceon Limited, under sub-section (2) of Section 87 read with sub-section (1) of Section 88 of the Securities Act, 2015 has been approved by the SECP and PSX to issue, circulate and publish the Prospectus for Initial Public Offering (IPO) of 27.350 million ordinary shares by Octopus Digital Limited (Company/Issuer/Octopus) to the institutional investors, high net worth individuals and the general public,” said Avanceon Limited in its filing to the bourse.

Panther Tyres successfully raises Rs2.632bn through book building

Octopus Digital's parent company Avanceon Limited is an industrial automation consultation and system integration entity. As per Avanceon Limited's financials, the company, in the first quarter ended March 31, 2021, recorded a consolidated profit after tax of Rs 244.8 million, down from Rs385 million in the same three-month period of the previous year.

Meanwhile, Octopus Digital specialises in helping businesses digitise their manufacturing, supply chain, and financial workflows backed by strategic and operational maintenance support services. “It is a unique enterprise that will fill the technology chasm facing the industrial sector in Pakistan today,” said Avanceon, in October 2020.

Avanceon has mandated BMA Capital as its sole financial consultant/advisor for the planned IPO.

PABC gears up as Pakistan’s eighth IPO this fiscal year, highest since 2009-10

Pakistan has been seeing a rising trend of listings on the PSX with 8 IPOs offered in FY2020-21 alone. This is in stark contrast to the previous fiscal year when no IPO was offered. In 2009-10, 8 IPOs were made before the number touched 7 in FY15. However, 7 IPOs were conducted in three years combined, from FY18 to FY20, as Pakistan’s stock market remained under pressure due to slowing economic growth and political uncertainty.

However, the trend seems to have picked up.

Back in June, Pakistan Aluminium Beverage Cans Limited (PABC) raised Rs4.6 billion after which Citi Pharma raised Rs 2.3 billion as well.

Earlier this year in January, Panther Tyres Limited successfully raised Rs 2.632 billion through a two-day book-building process, which saw broad-based participation.

The book-building was oversubscribed by 4.4 times with price closing at Rs 65.80 per share; an increase of 40 percent from the floor price of Rs 47.0 per share. The total demand received was Rs 8.215 billion against a total issue size of Rs 1.880 billion; oversubscribed by Rs 6.335 million.