Consumer Analyst / Channel Surveillance Specialist, Trudence Capital Advisors

Pranav Bhavsar

Consumer Analyst / Channel Surveillance Specialist

Trudence Capital Advisors

Trudence Capital Advisors Private Limited is a SEBI-registered Research Analyst, holding SEBI registration number INH000015747. Our firm is dedicated to providing independent and unbiased research on Indian mid to large-cap companies. Trudence Capital is known for its counter-consensus views, with a focus on forensic research and on-ground primary investigations. Our research approach is thorough, involving detailed analysis of accounting practices and governance, alongside extensive channel checks.

Independent & Unbiased Research

Private Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/browserstack-inc" target="_blank" data-smartkarma-citation="entities:36118:1" rel="noopener">Browserstack (1573804D US)</a> is a web and mobile testing platform company that aids developers to test their products for bugs and glitches across multiple desktops and mobiles.    </li>
<li>Channel feedback is encouraging and positive. The company is leveraging India's unique tailwinds, creating products that are global from Day 1.</li>
<li>Profitable from the first 6 months of operations, financials remain robust and the company's plan to cross $200 mn AAR this year is likely to materialise. </li>
</ul>



Browserstack (1573804D US) is a web and mobile testing platform company that aids developers to test their products for bugs and glitches across multiple desktops and mobiles.    
Channel feedback is encouraging and positive. The company is leveraging India's unique tailwinds, creating products that are global from Day 1.
Profitable from the first 6 months of operations, financials remain robust and the company's plan to cross $200 mn AAR this year is likely to materialise. 


Browserstack Tearsheet - India's SaaS Behemoth

Covering IPOs, Healthcare and Technology Stocks

Andrei Zakharov

Algosun Global

Equity Bottom-Up

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<li>
<a href="https://www.smartkarma.com/entities/freshworks-inc" target="_blank" data-smartkarma-citation="entities:34147:1" rel="noopener">Freshworks (FRSH US)</a>  upgraded its revenue guidance to ~$502M at the top end for FY22 and reported a 42% year-over-year revenue growth rate in 1QFY22. </li>
<li>We were impressed with subscription revenue growth, lower-than-expected loss, customer expansion, and efficient SaaS metrics. </li>
<li>We analyzed multiples of 50 publicly listed software companies with various growth profiles and split SaaS/Fintech companies into four growth groups.</li>
</ul>



Freshworks (FRSH US)  upgraded its revenue guidance to ~$502M at the top end for FY22 and reported a 42% year-over-year revenue growth rate in 1QFY22. 
We were impressed with subscription revenue growth, lower-than-expected loss, customer expansion, and efficient SaaS metrics. 
We analyzed multiples of 50 publicly listed software companies with various growth profiles and split SaaS/Fintech companies into four growth groups.


Freshworks: Solid 1Q and Strong Outlook Despite Delays With Closing Deals in Europe

<ul>
<li>Sequoia Capital India, one of the key shareholders of <a href="https://www.smartkarma.com/entities/freshworks-inc" target="_blank" data-smartkarma-citation="entities:34147:1" rel="noopener">Freshworks (FRSH US)</a> , made notable insider purchases in March. This is the biggest insider buying since IPO in 2021. </li>
<li>According to SEC filings, venture capital firm acquired ~5 million <a href="https://www.smartkarma.com/entities/freshworks-inc" target="_blank" data-smartkarma-citation="entities:34147:1" rel="noopener">Freshworks (FRSH US)</a>  shares at an average price of <strong>$17.38</strong> per share. </li>
<li>We believe that strong insider buying may indicate a bottom in <a href="https://www.smartkarma.com/entities/freshworks-inc" target="_blank" data-smartkarma-citation="entities:34147:1" rel="noopener">Freshworks (FRSH US)</a>  stock after significant multiple compression in the technology software sector. </li>
</ul>


Sequoia Capital India, one of the key shareholders of Freshworks (FRSH US) , made notable insider purchases in March. This is the biggest insider buying since IPO in 2021. 
According to SEC filings, venture capital firm acquired ~5 million Freshworks (FRSH US)  shares at an average price of $17.38 per share. 
We believe that strong insider buying may indicate a bottom in Freshworks (FRSH US)  stock after significant multiple compression in the technology software sector. 


Sequoia Capital India Acquired ~$87 Million Worth Of Freshworks Shares In March

<ul>
<li>We are moving our PT to $26 by applying a 14x multiple to CY22 revenue estimate of $491M, which we believe is fair given lower implied CY22 growth. </li>
<li>Freshworks has resolved the litigation filed by Zoho Corporation regarding trade secret misappropriation against Freshworks, eliminating key risk factor for investors.</li>
<li>Freshworks crossed the $400M ARR mark in the quarter ended Dec-21, and quarterly revenue exceeded $100M for the first time. </li>
</ul>


We are moving our PT to $26 by applying a 14x multiple to CY22 revenue estimate of $491M, which we believe is fair given lower implied CY22 growth. 
Freshworks has resolved the litigation filed by Zoho Corporation regarding trade secret misappropriation against Freshworks, eliminating key risk factor for investors.
Freshworks crossed the $400M ARR mark in the quarter ended Dec-21, and quarterly revenue exceeded $100M for the first time. 


Freshworks: Six Months Post-IPO. Valuation Update

APAC IPOs & Placements, Aequitas Research

Clarence Chu

APAC IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

RateGain Travel Technologies / Equity Capital Markets

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<li>
<a href="https://www.smartkarma.com/entities/rategain-travel-technologies" target="_blank" data-smartkarma-citation="entities:35265:1" rel="noopener">RateGain Travel Technologies (1920810D IN)</a> is looking to raise up to US$177m in its upcoming India IPO.</li>
<li>The deal will comprise a mix of primary and secondary shares, where the Promoters and a Pre-IPO investor, Wagner, are looking to pare down their stakes. </li>
<li>In our view, this listing being the first SaaS firm out of India, could garner investor interest which would aid listing sentiment as well.</li>
</ul>



RateGain Travel Technologies (1920810D IN) is looking to raise up to US$177m in its upcoming India IPO.
The deal will comprise a mix of primary and secondary shares, where the Promoters and a Pre-IPO investor, Wagner, are looking to pare down their stakes. 
In our view, this listing being the first SaaS firm out of India, could garner investor interest which would aid listing sentiment as well.


RateGain Travel Technologies IPO - First SaaS Listing in India and Could Be a Recovery Play

United States

Freshworks Inc. provides software as a service platform that enables small and medium-sized businesses to support customers through e-mail, phone, website, and social networks. The Company offers multi-product support, a knowledge base, self-service portal, community forums, and tools to leverage mainstream social media for customer support. Freshworks serves customers worldwide.

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Freshworks (FRSH US)

Browserstack Tearsheet - India's SaaS Behemoth

India Unicorn Series: We profile India's SaaS behemoth "BrowserStack". Global and profitable from Day 1, the opportunity set for SaaS is as good as...

Pranav Bhavsar

Freshworks: Solid 1Q and Strong Outlook Despite Delays With Closing Deals in Europe

Freshworks reported solid 1QFY22 earnings results and raised outlook for FY22. We believe the company may sustain 30%+ subscription revenue growth...

Andrei Zakharov

Sequoia Capital India Acquired ~$87 Million Worth Of Freshworks Shares In March

We maintain our bullish view on Freshworks and see notable insider buying as a strong interest among key shareholders, including Sequoia Capital India

Andrei Zakharov

Freshworks: Six Months Post-IPO. Valuation Update

Our new price target of $26 (vs. prior $47) is based on relative value methodology and implies ~39% upside, what is below IPO price of $36 per share

Andrei Zakharov

RateGain Travel Technologies IPO - First SaaS Listing in India and Could Be a Recovery Play

RateGain Travel Technologies (1920810D IN) is looking to raise up to US$177m in its India IPO. The listing will be the first SaaS listing in India.

Clarence Chu

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