A reality check on Happiest Minds’s dizzying debut

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Editor's note: One of India’s smallest IT services companies now has the most expensive valuation. But look under the hood, and there isn't much to justify Happiest Minds Technologies’s gravity-defying stock market debut last week. The company does not even have a CEO, with four senior executives jointly performing that role.  Yet, on 17 September, the stock listed at Rs 351 and kept rising to close the day at Rs 371 on the BSE, a whopping premium of over 123% on its initial public offer price of Rs 166. Earlier this month, investors accorded a rousing reception to its Rs 702-crore IPO. The issue was subscribed over 150 times. It received bids for 351.18 crore shares as against the 2.32 crore on offer. A few days after the IPO, an information technology services industry observer wrote a congratulatory email to Ashok Soota. The Happiest Minds chairman thanked the person, while acknowledging that the challenge now was to live up to the expectations of investors.  He was not being modest.  Even going by the logic-defying rally fuelling stock markets, and the fact that …