Introduction to the Company

Octopus Digital Limited is a company focused on developing and marketing digital solutions for
industrial and manufacturing sectors. The company aims to build and sell twenty-nine independent
intellectual properties (IPs) including dashboards tailored for specific objectives and business
processes. These IPs are categorized into industry vertical-based, function-based, utilities-based,
maintenance-based, and fuel retail specialty-based IPs.
In order to enhance efficiencies in industrial and manufacturing processes, Octopus Digital Limited
plans to offer two main platforms: Topware and OmniConnect. Topware is an end-to-end solution
comprising digital dashboarding, prediction & prescription, and an autonomous command center. It
includes assets such as Loop Tuning App and Building Management System App. On the other hand,
OmniConnect is a suite of intellectual properties enabling predictive analysis to prevent future losses
through digitization and big data usage.
The company intends to market these digital dashboards, Topware, and OmniConnect in Pakistan,
the Middle East, and the United States. The IPO proceeds will be utilized for developing these IPs,
associated marketing and selling expenses, and HR costs related to marketing and sales.
Financially, Octopus Digital Limited has shown growth in its revenue and profitability over the years
leading up to the IPO. The company's net worth has increased significantly from negative figures in
2018 to over PKR 1.3 billion in 2020. Revenue has also seen a substantial rise from PKR 18.5 million in
2019 to PKR 277.1 million in 2020. The company has demonstrated a strong gross margin of 92% in
2020, indicating efficient cost management. Additionally, the profit after tax margin has grown from
13% in 2019 to 75% in 2020, reflecting improved operational efficiency and profitability.
Overall, Octopus Digital Limited appears to be a promising player in the digital solutions space, with
a focus on innovative products for industrial and manufacturing sectors and a track record of
financial growth leading up to its IPO.

An Initial Public Offering (IPO) is the first sale of a company's shares to the public on a stock
exchange. When a company decides to go public through an IPO, it offers a portion of its ownership
to investors in exchange for capital. This process allows the company to raise funds for various
purposes such as expansion, debt repayment, acquisitions, or research and development.
Companies choose to go public for several reasons, including:
1. Access to Capital: One of the primary reasons for going public is to raise capital from the public
markets. This capital can be used for growth initiatives, investments, and other strategic objectives.
2. Enhanced Visibility and Prestige: Going public can increase a company's visibility and credibility in
the market, attracting more customers, partners, and employees.
3. Liquidity for Existing Shareholders: Going public provides an opportunity for existing
shareholders, such as founders, employees, and early investors, to monetize their investments by
selling shares on the public market.
4. Currency for Acquisitions: Publicly traded shares can be used as a currency for acquisitions,
allowing the company to pursue growth through mergers and acquisitions.
Benefits of an IPO for the company and its stakeholders include:
1. Access to Capital: IPOs provide a significant source of capital for the company's growth and
expansion plans.
2. Enhanced Brand Visibility: Going public can enhance the company's brand visibility and reputation
in the market.
3. Liquidity for Shareholders: Existing shareholders can realize the value of their investments by
selling shares on the public market.
4. Employee Incentives: Publicly traded shares can be used as employee incentives, attracting and
retaining top talent.
However, there are also risks associated with an IPO, including:
1. Market Volatility: The stock price of a newly public company can be volatile, leading to fluctuations
in shareholder value.
2. Regulatory Compliance: Public companies are subject to stringent regulatory requirements,
increasing compliance costs and administrative burden.
3. Loss of Control: Going public may result in a loss of control for the company's founders and early
investors as public shareholders have voting rights.
In conclusion, an IPO is a significant milestone for a company and its stakeholders, offering access to
capital, enhanced visibility, and liquidity. However, it also comes with risks such as market volatility,
regulatory compliance, and potential loss of control. Companies must carefully weigh the benefits
and risks before deciding to go public.
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In preparation for the Initial Public Offering (IPO), Octopus Digital Limited undertook several crucial
steps to ensure a successful and compliant offering. Here are the key steps the company took in the
pre-IPO preparation process:
1. Financial Restructuring:
o Octopus Digital Limited conducted a thorough financial restructuring to ensure that its financial
statements were in order and compliant with regulatory requirements. This involved auditing
financial records, preparing financial statements, and ensuring transparency and accuracy in financial
reporting.
2. Hiring Underwriters:
o The company appointed BMA Capital Management Limited as the Book Runner for the IPO.
Underwriters play a vital role in the IPO process by helping the company determine the offering
price, underwriting the shares, and ensuring a smooth offering process.
3. Legal Compliance:
o Octopus Digital Limited focused on ensuring legal compliance at every stage of the IPO process. This
included working closely with legal advisors to navigate regulatory requirements, drafting the
prospectus in accordance with Securities and Exchange Commission of Pakistan (SECP) guidelines,
and obtaining necessary approvals from regulatory authorities.
4. Due Diligence:
o The company conducted extensive due diligence to assess its business operations, financial
performance, legal compliance, and potential risks. This involved reviewing contracts, verifying assets
and liabilities, evaluating market positioning, and identifying any areas that needed to be addressed
before the IPO.
5. Engagement with Regulatory Authorities:
o Octopus Digital Limited engaged proactively with regulatory authorities such as the SECP and
Pakistan Stock Exchange (PSX) to ensure that all regulatory requirements were met. This included
submitting necessary documents, obtaining approvals, and adhering to disclosure and reporting
standards.
6. Corporate Governance Enhancement:
o The company focused on enhancing its corporate governance practices to instill investor confidence.
This involved strengthening board oversight, improving transparency in decision-making processes,
and implementing robust internal controls.

By meticulously following these steps, Octopus Digital Limited positioned itself for a successful IPO,
demonstrating its commitment to transparency, compliance, and investor protection.

Valuation
Before the IPO, Octopus Digital Limited would have been valued using various methods to determine
the offering price of its shares to the public. Valuation is a critical aspect of the IPO process as it
helps in setting a fair price that reflects the company's worth and potential for investors. Some
common methods used for valuing a company before an IPO include:
1. Comparable Company Analysis (CCA): This method involves comparing the financial metrics of the
company with similar publicly traded companies in the same industry. By analyzing factors such as
revenue, earnings, growth rates, and multiples like Price-to-Earnings (P/E) ratio, Price-to-Sales (P/S)
ratio, and Enterprise Value-to-EBITDA (EV/EBITDA), a valuation range can be derived.
2. Discounted Cash Flow (DCF) Analysis: DCF analysis estimates the present value of the company's
future cash flows by discounting them back to their current value. This method takes into account
the company's projected cash flows, growth rates, and the risk associated with the business to
determine its intrinsic value.
3. Precedent Transactions Analysis: This method involves analyzing the valuation multiples of similar
companies that have been acquired or have gone public recently. By looking at the transaction
values of these comparable companies, a valuation benchmark can be established for the company
going public.
4. Book Building Process: In the book building process, institutional investors and high-net-worth
individuals submit bids indicating the price and quantity of shares they are willing to purchase. Based
on these bids, the final price of the shares is determined, reflecting the demand from investors.
Factors considered in the valuation of Octopus Digital Limited before the IPO may include:

o Financial performance and growth potential of the company

o Market trends and industry outlook
o Competitive landscape and positioning within the industry
o Intellectual property and technology assets
o Management team and track record
o Regulatory environment and risks
o Future growth strategies and expansion plans

By utilizing a combination of these valuation methods and considering various factors specific to
Octopus Digital Limited, the company's valuation before the IPO would have been determined to set
the offering price of its shares in a manner that is attractive to investors while reflecting the
company's true value and growth prospects.

Regulatory Approval: Discuss the regulatory requirements the company had to fulfill to proceed with
the IPO, including approvals from the Securities and Exchange Commission of Pakistan (SECP) and
compliance with listing rules of the Pakistan Stock Exchange (PSX).
To proceed with the Initial Public Offering (IPO), Octopus Digital Limited had to fulfill various
regulatory requirements and obtain approvals from the Securities and Exchange Commission of
Pakistan (SECP) and comply with the listing rules of the Pakistan Stock Exchange (PSX). Here are the
key regulatory requirements the company had to fulfill:
1. SECP Approval:
 Octopus Digital Limited needed to obtain approval from the SECP for the IPO. The SECP is the
regulatory body in Pakistan responsible for overseeing the securities market and ensuring
compliance with securities laws and regulations. The company had to submit the prospectus and
other relevant documents to the SECP for review and approval before proceeding with the IPO.
2. Compliance with SECP Regulations:
 The company had to ensure compliance with SECP regulations governing the issuance of securities,
disclosure requirements, and investor protection. This included providing accurate and transparent
information in the prospectus, adhering to pricing guidelines, and following regulations related to
the conduct of the IPO.
3. Listing Rules of the PSX:
 Octopus Digital Limited had to comply with the listing rules of the Pakistan Stock Exchange (PSX) to
have its shares listed for trading on the exchange post-IPO. The company needed to meet the
eligibility criteria set by the PSX, including minimum capital requirements, corporate governance
standards, and financial reporting obligations.
4. Disclosure and Transparency:
 The company was required to provide comprehensive disclosure of its financial performance,
business operations, risks, and prospects in the prospectus. Transparency and accuracy in disclosure
are essential to ensure investor confidence and compliance with regulatory requirements.
5. Corporate Governance Standards:
 Octopus Digital Limited had to demonstrate adherence to corporate governance standards set by
the SECP and the PSX. This included having an independent board of directors, establishing board
committees, implementing internal controls, and ensuring transparency in decision-making
processes.

By fulfilling these regulatory requirements and obtaining approvals from the SECP and complying
with the listing rules of the PSX, Octopus Digital Limited ensured a smooth and compliant IPO
process, enhancing investor trust and market credibility.

Marketing and Roadshow: Explain how the company marketed the IPO to potential investors and
conducted roadshows to generate interest and demand for its shares.
 To market the Initial Public Offering (IPO) and generate interest and demand for its shares, Octopus
Digital Limited employed various strategies, including conducting roadshows and engaging with
potential investors. Here is how the company marketed the IPO:
1. Engagement with Investment Banks:
 Octopus Digital Limited collaborated with investment banks, such as BMA Capital Management
Limited, the Book Runner for the IPO, to leverage their expertise in marketing the offering to
institutional and retail investors. Investment banks played a crucial role in promoting the IPO and
attracting investor interest.
2. Roadshows:
 The company conducted roadshows in key cities and financial centers to showcase its business
model, growth prospects, and investment opportunity to potential investors. Roadshows provided a
platform for company executives to interact with investors, address queries, and build confidence in
the IPO.
3. Investor Presentations:
 Octopus Digital Limited organized investor presentations to provide detailed insights into its
business operations, financial performance, competitive positioning, and future growth strategies.
These presentations helped investors understand the value proposition of the company and the
potential returns from investing in the IPO.
4. Media and Public Relations:
 The company utilized media channels, press releases, and public relations activities to create
awareness about the IPO and reach a broader audience of potential investors. Media coverage
helped in building visibility, credibility, and interest in the offering.
5. Digital Marketing:
 Octopus Digital Limited leveraged digital marketing channels, including social media, email
campaigns, and online advertisements, to reach a wider audience of retail investors and create buzz
around the IPO. Digital marketing strategies were used to engage with tech-savvy investors and drive
participation in the offering.
6. Engagement with Institutional Investors:
 The company targeted institutional investors, including mutual funds, pension funds, and asset
management firms, through tailored presentations and one-on-one meetings. Engaging with
institutional investors helped in securing anchor investments and building institutional support for
the IPO.

By implementing a comprehensive marketing strategy that included roadshows, investor

presentations, media outreach, digital marketing, and engagement with institutional investors,
Octopus Digital Limited effectively promoted its IPO, generated interest among investors, and
successfully attracted demand for its shares.

9. Subscription and Allotment: Describe the subscription process, including the opening and closing
dates, subscription levels, oversubscription, and allotment of shares to investors.
 The subscription process for the Initial Public Offering (IPO) of Octopus Digital Limited involved
several key steps, including opening and closing dates, subscription levels, oversubscription, and
allotment of shares to investors. Here is a description of the subscription process:
10. Opening and Closing Dates:
 The registration period for the IPO was for five working days, starting from the 1st XXX 2021 to the
7th XXX 2021. During this period, eligible investors could register and submit their bids for
subscribing to the shares of Octopus Digital Limited.
11. Subscription Levels:
 Eligible investors, both individual and institutional, were required to submit bids for a minimum
amount of PKR 1,000,000/- (Rupees 1 Million only) to participate in the subscription process.
Investors could place bids either at the "Limit Price" or as a "Step Bid" with a minimum bid size of
PKR 1,000,000/-.
12. Oversubscription:
 In the event of oversubscription, where the demand for shares exceeded the available supply, the
company had a mechanism in place to manage the allocation of shares. The prospectus outlined the
process for allotment in case of oversubscription to ensure fair distribution of shares among
investors.
13. Allotment of Shares:
 The final allotment of shares to successful bidders was determined after evaluating the public
response to the Retail Portion of the Issue. If the retail portion was undersubscribed, the
unsubscribed portion would be allotted to successful bidders on a pro-rata basis as per regulation
11(5) of the PO Regulation.
 Shares from the Book Building portion were issued simultaneously with shares to retail investors in
the form of book entry to be credited in their respective CDS Accounts. All successful bidders were
required to provide their CDS Account numbers in the bid application for this purpose.
14. Refund Process:
 Bidders who made bids below the Strike Price and did not qualify for allotment of shares had their
Margin Money refunded. The refund process was initiated within three working days from the close
of the bidding period, ensuring timely return of funds to unsuccessful bidders.

By following a structured subscription process with clear opening and closing dates, minimum bid
requirements, provisions for oversubscription, and a transparent allotment mechanism, Octopus
Digital Limited ensured a fair and efficient allocation of shares to investors participating in the IPO.

1. Listing and Trading: Detail the listing process on the Pakistan Stock Exchange, including the listing
date, trading debut, trading performance, and any post-listing requirements.

The listing process on the Pakistan Stock Exchange (PSX) involves several steps that a company must
follow to become a publicly traded entity. Here is an overview of the listing process, trading debut,
performance, and post-listing requirements:
2. Listing Process:
 Approval: The company seeking to list on the PSX must obtain approval from the Securities and
Exchange Commission of Pakistan (SECP) for the issuance of shares to the public.
 Submission of Documents: The company submits the necessary documents, including the
prospectus, financial statements, and other relevant information, to the PSX for review.
 Due Diligence: The PSX conducts due diligence to ensure compliance with listing regulations and
assess the company's suitability for listing.
 Listing Fee: The company pays the listing fee to the PSX as per the prescribed schedule.
3. Listing Date:
 Once the company fulfills all listing requirements and the prospectus is approved, the PSX assigns a
listing date for the company's shares to start trading on the exchange.
4. Trading Debut:
 On the listing date, the company's shares are introduced to the market for trading. The opening
price is determined based on the demand and supply dynamics in the market.
 The trading debut is an important event for the company as it marks its transition to a publicly
traded entity and provides liquidity to existing shareholders.
5. Trading Performance:
 The trading performance of the company's shares post-listing depends on various factors such as
market conditions, investor sentiment, company performance, and industry trends.
 The share price may fluctuate in the initial days of trading as investors react to the new listing and
adjust their positions based on market dynamics.
6. Post-Listing Requirements:
 Continuous Disclosure: The company is required to make timely and accurate disclosures of
material information to the public and regulatory authorities.
 Compliance: The company must comply with the listing regulations of the PSX, including financial
reporting requirements, corporate governance standards, and other regulatory obligations.
 Annual General Meeting (AGM): The company is required to hold an AGM annually to update
shareholders on the company's performance and future plans.
 Corporate Actions: Any corporate actions such as dividends, bonus issues, rights offerings, or share
buybacks must be approved and disclosed as per regulatory requirements.

Overall, the listing process on the Pakistan Stock Exchange involves regulatory approvals, due
diligence, and compliance with listing requirements. Once listed, the company must adhere to post-
listing obligations to maintain transparency and investor confidence in the market.

To analyze Octopus Digital Limited's performance post-IPO, we would typically look at various
factors such as stock price movements, market capitalization, financial results, and investor
sentiment. However, the provided document does not contain specific information regarding the
post-IPO performance of Octopus Digital Limited.
For a comprehensive analysis of the company's post-IPO performance, we would need access to data
such as historical stock prices, financial statements post-IPO, market reports, and investor sentiment
 surveys. This information would help in evaluating how the company has fared in the stock market,
its financial health, growth trajectory, and how investors perceive its prospects.
If you have access to additional data or specific information related to Octopus Digital Limited's
post-IPO performance, please provide it so that we can conduct a more detailed analysis.

Based on the information provided in the document, here is a summary of the key findings regarding
Octopus Digital Limited's IPO process, success factors, challenges faced, and future prospects as a
public company:
1. Success Factors:
 Strong Financial Performance: Octopus Digital Limited demonstrated robust financial performance,
with a significant increase in net profit margin in CY20, mainly attributed to its AMS services division.
 Clear Business Model: The company's focus on providing AMS services to clients helped in
streamlining its revenue and expenditure, providing clarity to investors.
 Collaboration with Investment Banks: Partnering with investment banks like BMA Capital
Management Limited helped in effectively marketing the IPO and attracting investor interest.
 Roadshows and Investor Presentations: Conducting roadshows and investor presentations enabled
Octopus Digital Limited to engage with potential investors, showcase its business model, and build
confidence in the offering.
2. Challenges Faced:
 Oversubscription Management: Handling oversubscription and ensuring fair allocation of shares
could have been a challenge for the company.
 Market Volatility: External factors such as market volatility and economic conditions may have
posed challenges during the IPO process.
 Regulatory Compliance: Adhering to regulatory requirements and ensuring transparency in the
subscription and allotment process could have been challenging.
3. Future Prospects:
 Growth Opportunities: With a strong financial foundation and a focus on AMS services, Octopus
Digital Limited is well-positioned to capitalize on growth opportunities in the digital services sector.
 Market Expansion: The company can explore expanding its services to new markets and diversifying
its client base to drive future revenue growth.
 Investor Confidence: Continued transparency, strong financial performance, and effective
communication with investors can enhance investor confidence and support the company's stock
performance in the future.

In conclusion, Octopus Digital Limited's successful IPO process, driven by its financial performance,
clear business model, and strategic marketing efforts, sets a positive foundation for its future as a
public company. By addressing challenges effectively and focusing on growth opportunities, the
company can strengthen its market position and create value for its shareholders in the long term.