Yaap Digital IPO

Corporate Identity Snapshot

Location and Operational Presence

• Registered Office: Mumbai – strategic for regulatory, financial, and media ecosystem access

• Corporate Office: Gurugram – hub for marketing talent, tech workforce, and enterprise clients

• International Presence: Through subsidiaries in the Middle East and Asia-Pacific

Industry and Sector Classification

Products and Services Offered

Yaap Digital operates as a full-stack digital marketing and brand transformation partner.

Key Service Verticals

The company services large enterprises, digital-first brands, startups, and multinational clients, offering both retainer-based and performance-linked engagements.

Industry Overview – Digital Marketing in India

Yaap Digital operates in India’s digital advertising and marketing services industry, which has seen rapid expansion due to smartphone penetration, e-commerce growth, and digital consumption habits.

Market Size and Growth Trends

Key Growth Drivers

• Rising internet users (900+ million in India)

• Shift from traditional to digital media

• Data-driven marketing demand

• Growth of D2C and app-based businesses

Regulatory Landscape

The industry is regulated indirectly through:

• Advertising standards

• Data privacy laws

• IT and intermediary regulations

• Platform compliance norms (Google, Meta, etc.)

No single license governs digital agencies, but compliance complexity is rising.

Future Outlook

What the Company Does

Yaap Digital provides end-to-end digital marketing solutions, integrating strategy, creative execution, media buying, and technology.

Target Customers

Position in the Value Chain

Brand Owner → Yaap Digital (Strategy + Execution + Tech) → Digital Platforms → End Consumers

Yaap positions itself mid-to-high value chain, avoiding commoditised execution-only work.

Applicable Laws and Regulations

The company maintains an internal compliance framework led by a Company Secretary & Compliance Officer.

Key Business Risks

Financial and Operational Risks

• Working capital intensity due to receivables

• Exposure to economic slowdowns

• Integration risk from acquisitions (e.g., GoZoop)

Promoter Details

Promoter Contribution

• Promoters collectively hold more than 20% post-issue, meeting SEBI requirements

• Locked-in for 3 years post listing

Promoters bring deep domain experience in advertising, media, and digital services.

Key Subsidiaries

These entities allow geographic reach, service diversification, and client cross-selling.

Board of Directors

Key Managerial Personnel (KMP)

Governance Structure

Yaap Digital follows SEBI LODR and Companies Act governance norms, including independent oversight.

Statutory Committees

Overview of Litigation Status

As per the RHP, Yaap Digital Limited, its promoters, directors, and subsidiaries are subject only to routine commercial and operational litigations, which are not material enough to threaten business continuity or financial stability.

Litigation Classification

The company has adopted a Materiality Policy approved by its Board to ensure transparent disclosure of all material litigations, in line with SEBI ICDR norms.

Key Takeaway for Investors
There are no regulatory red flags or promoter-related litigations that could materially impact the IPO or post-listing operations.

Core Approvals Required for Business Operations

Digital marketing companies do not require sector-specific licenses; however, Yaap Digital operates under multiple statutory registrations.

All approvals are valid and subsisting as of the date of the RHP.

Consolidated Financial Snapshot

(₹ in Lakhs)

Financial Performance Insights

• Revenue CAGR (FY23–FY25): ~21%

• Margin expansion driven by:

  • Higher-value performance marketing

  • Better client mix

  • Technology-enabled efficiencies

• Profitability has more than doubled over two years

This reflects a scaling digital services model, not a flat agency business.

Debt Profile

The company operates with a low-debt structure, relying primarily on internal accruals and working capital management.

Key Credit Relationships

• Kotak Mahindra Bank

• HSBC

Investor Interpretation
Low leverage = lower financial risk and higher flexibility post-IPO.

Cash Flow Summary (₹ in Lakhs)

Cash Flow Observations

• Operating cash flows track profitability

• Investing cash outflows relate to:

  • Technology

  • Subsidiary support

  • Strategic acquisitions

• No aggressive debt-funded expansion

Key Ratio Analysis

What These Ratios Signal

• Improving operational efficiency

• Strong capital productivity

• Comfortable liquidity

• Conservative balance sheet

Management’s View on Performance

Management attributes growth to:

• Rising digital spends by enterprises

• Shift from traditional to performance marketing

• Cross-selling across subsidiaries

Strategic Growth Pillars

Key Challenges Highlighted

• Talent retention in digital roles

• Platform policy changes

• Client budget cyclicality

Objects of the Issue

The IPO is a 100% fresh issue, with proceeds earmarked as follows:

Strategic Rationale

The acquisition of GoZoop strengthens:

• Creative capabilities

• Enterprise client access

• Integrated brand offerings

Valuation Methodology

The issue price is determined using:

• Earnings-based valuation

• Peer comparison

• Growth trajectory

• Return ratios

Comparable Peer Snapshot (Indicative)

Yaap Digital positions itself mid-range, reflecting:

• Strong growth

• Improving margins

• Scalable platform

Capital Structure – Pre & Post IPO

Yaap Digital Limited has an equity-only capital structure, with no outstanding preference shares or complex instruments.

Since the IPO is a pure fresh issue, there is no Offer for Sale (OFS) and no promoter exit, which is a positive signal for long-term investors.

Post-Issue Ownership Distribution

Lock-in Provisions

This structure ensures stability in the initial trading phase and aligns promoter incentives with long-term value creation.

Company’s Dividend Philosophy

Yaap Digital has adopted a formal dividend policy approved by the Board.

Key Principles

• Dividends will depend on:

  • Profitability

  • Cash flows

  • Capex & acquisition needs

• Priority given to growth reinvestment

• No guaranteed payout ratio

Nature of Related Party Transactions

The company engages in arm’s-length transactions with group entities.

Governance Safeguards

• Audit Committee approval mandatory

• Disclosure under AS-18

• No preferential or abusive arrangements reported

Material Contracts Related to the IPO

All contracts are available for inspection as disclosed in the RHP.

Issue Summary

Allocation Break-up

Shareholder Rights

Shareholders enjoy full rights under Companies Act & SEBI regulations.

Mandatory Disclosures Included

• SEBI ICDR compliance

• Companies Act disclosures

• Risk factor declarations

• Monitoring agency reporting

• Material contract inspection

• No outstanding defaults or willful defaulter tags

Yaap Digital Limited represents a scalable digital-first marketing platform, combining:

• Strong revenue growth

• Expanding margins

• Low leverage

• Promoter commitment

• Clear acquisition-led strategy

The IPO is structured for growth capital, not promoter exit, making it suitable for investors seeking long-term digital economy exposure rather than short-term yield plays.