The initial public offering (IPO) of Western Carriers (India) commenced today, Friday, September 13. The logistics company, incorporated in 2011, is offering its shares in the price range of ₹163-172 apiece. Investors can apply for a minimum of 87 equity shares and multiples thereafter. The subscription window for this IPO will close on Wednesday, September 18.
Key Details of Western Carriers (India) IPO
Price Band and Lot Size
The price band for the Western Carriers (India) IPO is set between ₹163 and ₹172 per share. The minimum application requires 87 shares, translating to a minimum investment of ₹14,964 at the upper price band.
Subscription Status
As of 10:15 AM on the first day, the IPO has seen an overall subscription of 0.06 times. The retail investor portion is subscribed 0.11 times, while non-institutional investors have subscribed 0.01 times. The QIB segment is yet to see any subscriptions.
Grey Market Premium (GMP)
Currently, the grey market premium (GMP) for Western Carriers (India) IPO is zero, indicating no premium trading and an expected flat listing at ₹172 on the Indian stock exchanges.
Company Overview
Western Carriers (India) is a multimodal, rail-focused, 4PL asset-light logistics company offering integrated, end-to-end logistics solutions. The company serves a diverse base of 1,647 customers across various sectors.
Financial Performance
For the fiscal year 2024, the company's top 10 customers contributed 71.97% of the total revenue. Western Carriers has demonstrated consistent financial growth, with revenues of ₹12,131.71 million, ₹10,966.25 million, and ₹10,560.68 million for FY24, FY23, and FY22, respectively.
Use of IPO Proceeds
The company plans to use the net proceeds from the IPO to pay off borrowings and fund capital expenditures, including the purchase of commercial vehicles, shipping containers, and reach stackers.
Expert Opinions on Subscription
StoxBox Recommendation
Akriti Mehrotra, a research analyst at StoxBox, recommends subscribing to the IPO, citing the lower valuation and growth prospects. "The current issue is priced at a PE of 16.8 times on the upper band based on FY24 earnings. Given its strong financials and strategic initiatives, we recommend a 'subscribe' rating for a medium to long-term investment perspective," said Mehrotra.
Swastika Investmart Analysis
Swastika Investmart provides a 'may apply' rating for long-term investors with a high-risk tolerance, highlighting the company's consistent financial growth and reasonable IPO valuation. "Western Carriers (India) has exhibited slow but consistent financial growth. The IPO's valuation is considered reasonable despite the company's long payment cycle and operational risks," noted the brokerage firm.
Conclusion: Should You Subscribe?
Western Carriers (India) IPO presents a promising opportunity for investors looking to capitalize on the expanding rail-road multimodal logistics sector. With positive financial performance and strategic initiatives, subscribing to this IPO could yield substantial returns for medium to long-term investors.