Investors are in for a treat today as the primary market welcomes diverse IPOs. From the logistics sector to specialized manufacturing, there’s something for everyone. Western Carriers (India) Limited, a prominent player in the logistics industry, is making its debut with a mainboard IPO.
Meanwhile, three SME IPOs from Envirotech Systems Limited, Deccan Transcon Leasing Limited, and Popular Foundations Limited are also opening today. These companies are looking to raise a total of ₹608.05 crore.
Let’s dive into the details of these exciting offerings.
Western Carriers (India)
| Offer Price | ₹163 – ₹172 per share |
| Face Value | ₹5 per share |
| Opening Date | 13 September 2024 |
| Closing Date | 18 September 2024 |
| Total Issue Size (in Shares) | 28,655,813 |
| Total Issue Size (in ₹) | ₹492.88 Cr |
| Issue Type | Book Built Issue IPO |
| Lot Size | 87 Shares |
| Listing at | BSE, NSE |
Western Carriers (India) is offering 28,655,813 shares to the public, raising up to ₹492.88 crores. The IPO includes a fresh issue of ₹400.00 crores and an offer for sale of ₹92.88 crores. The shares will be listed on both BSE and NSE, increasing the company’s shareholding from 78,699,400 to 101,955,213. Investors can bid for a minimum of 87 shares and must bid in multiples of 87. The minimum lot size investment for sNII is 1,218 shares (₹209,496), and for bNII, it is 5,829 shares (₹1,002,588).
Objectives of the IPO
The objectives outlined by Western Carriers (India) for the IPO are:
- Debt Repayment: The company intends to use a portion of the IPO proceeds to prepay or repay outstanding borrowings. This can reduce interest expenses, improve the company’s debt-to-equity ratio, and enhance its financial flexibility.
- Capital Expenditure: The funds will be allocated towards the purchase of commercial vehicles, specialized containers, and reach stackers. This expansion of the company’s fleet and equipment will enable them to handle larger volumes of cargo, improve efficiency, and potentially capture a larger market share.
- General Corporate Purposes: The remaining funds will be utilized for various corporate activities that align with the company’s strategic goals.
GMP
The current grey market premium (GMP) for Western Carriers India is zero. This suggests that the company’s shares are not trading at a premium in the grey market, and they are expected to be listed flat at ₹172 on the Indian bourses.
Company Overview
Western Carriers is a multi-modal logistics company focused on rail transportation. They offer customized solutions for road, rail, water, and air transportation, along with value-added services. The company serves various sectors, including metals, FMCG, pharmaceuticals, chemicals, engineering, oil and gas, and retail.
Their clientele includes major corporations like Tata Steel, Hindalco Industries, Jindal Stainless, JSW Steel, Bharat Aluminium Company, Vedanta, Hindustan Unilever, Hindustan Coca-Cola Beverages, and DHL Logistics among others. The company also provides chartering services, stevedoring services, and coastal cargo movement. They specialize in combining rail and road movements through their asset-light business model. As of December 31, 2022, the company served over 1,100 customers and had 1,350 employees.
SWOT Analysis
| STRENGTHS | WEAKNESSES |
| The company’s experienced management team has a strong track record in the logistics industry.Western Carriers serves a diverse range of sectors, reducing their reliance on any single industry.The company has demonstrated consistent growth in revenue and assets over the past few years.Their focus on rail transportation and an asset-light approach can lead to cost efficiencies. | The logistics industry is highly competitive, with numerous players operating in the market.The company’s operations are subject to various regulations, which can impact their profitability.Changes in fuel prices can affect the company’s operating costs. |
| OPPORTUNITIES | THREATS |
| The rise of e-commerce can drive demand for efficient logistics solutions.Government initiatives to improve transportation infrastructure can benefit the company’s operations.Western Carriers can explore opportunities to expand their services to new regions or countries. | A slowdown in the economy can reduce demand for logistics services.Advancements in technology, such as autonomous vehicles or drones, could disrupt the traditional logistics industry.Natural disasters can impact the company’s operations and supply chains. |
Financial Strength
Western Carriers has shown consistent financial growth over the past three years. Their assets have increased from ₹4,903.29 lakhs in FY22 to ₹7,540.09 lakhs in FY24, representing a growth of 53.8%. Revenue has also grown steadily, from ₹14,757.89 lakhs in FY22 to ₹16,914.1 lakhs in FY24, marking an increase of 14.6%.
Popular Foundations Limited
| Offer Price | ₹37 per share |
| Face Value | ₹10 per share |
| Opening Date | 13 September 2024 |
| Closing Date | 18 September 2024 |
| Total Issue Size (in Shares) | 5,370,000 |
| Total Issue Size (in ₹) | ₹19.87 Cr |
| Issue Type | Fixed Price Issue IPO |
| Lot Size | 3000 Shares |
| Listing at | BSE, SME |
Popular Foundations Limited is offering 53,70,000 shares to the public at a fixed price of ₹37 per share. The IPO is scheduled from September 13th to 18th, 2024, and will be listed on BSE SME. The total issue size is ₹19.87 crores, and the pre-issue shareholding is 1,50,08,000 shares. The allotment and listing are expected to take place on September 19th and 23rd, respectively. The minimum lot size for retail investors is 3000 shares (₹111,000), and for HNIs, it is 6,000 shares (₹222,000).
Objectives of the IPO
Popular Foundations plans to use the proceeds from the IPO for:
- Prepayment or repayment of outstanding borrowings
- Funding working capital requirements
- General corporate purposes
GMP
The current grey market premium (GMP) for Popular Foundations is zero. This suggests that the company’s shares are not trading at a premium in the grey market, and they are expected to be listed flat at ₹37 on BSE SME.
Company Overview
Popular Foundations is an engineering and construction company specializing in end-to-end solutions. They focus on projects like factories, educational institutions, and commercial and residential buildings, primarily in and around Chennai. The company has also executed projects in other cities like Pondicherry, Tanjore, Bangalore, Trichy, Madurai, Vizhuppuram, and Coimbatore. As of September 7th, 2024, they had 86 on-site employees.
SWOT Analysis
| STRENGTHS | WEAKNESSES |
| The company has a strong presence in and around Chennai, which gives them a deep understanding of local market dynamics and regulations.Popular Foundations’ experienced team likely has a solid track record in the construction industry.Their specialization in non-residential and non-government projects can provide them with a competitive edge. | While they have expanded to other cities, their primary focus on Chennai might limit their growth potential.Reliance on a few large projects can make the company vulnerable to project delays or cancellations. |
| OPPORTUNITIES | THREATS |
| India’s growing economy and urbanization can drive demand for construction services.Government initiatives for infrastructure development can create opportunities for Popular Foundations.The company can explore opportunities in other sectors, such as renewable energy or healthcare construction. | The construction industry is highly competitive, with numerous players vying for projects.Increases in the cost of construction materials can impact profitability.A slowdown in the economy can reduce demand for construction services. |
Financial Strength
Popular Foundations has shown significant financial growth over the past two years. Their revenue increased from ₹2,630.17 lakhs in FY22 to ₹5,191 lakhs in FY24, a growth of 97.4%. The year-over-year growth from FY23 to FY24 was 7%. The company’s profitability has also improved, with profit after tax increasing from ₹48.08 lakhs in FY22 to ₹347.76 lakhs in FY24, a growth of 623.3%. The year-over-year growth in PAT from FY23 to FY24 was 191%.
Deccan Transcon Leasing Ltd.
| Offer Price | ₹102 to ₹108 per share |
| Face Value | ₹10 per share |
| Opening Date | 13 September 2024 |
| Closing Date | 18 September 2024 |
| Total Issue Size (in Shares) | 6,024,000 |
| Total Issue Size (in ₹) | ₹65.06 Cr |
| Issue Type | Book Built Issue IPO |
| Lot Size | 1200 Shares |
| Listing at | NSE, SME |
Deccan Transcon Leasing is offering 6,024,000 shares to the public, raising up to ₹65.06 crores. The IPO includes a fresh issue of ₹59.66 crores and an offer for sale of ₹5.40 crores. The shares will be listed on NSE SME, increasing the company’s shareholding from 17,199,448 to 22,723,448. Investors can bid for a minimum of 1200 shares, with a minimum investment of ₹129,600 for retail investors and ₹259,200 for HNIs. The allotment is expected on September 19th, and the listing is tentatively set for September 23rd.
Objectives of the IPO
Deccan Transcon Leasing plans to use the IPO proceeds for:
- Capital expenditure for procurement of tank containers
- Funding working capital requirements
- General corporate purposes
GMP
The current grey market premium (GMP) for Deccan Transcon Leasing is +30. This suggests that the company’s shares are trading at a premium of ₹30 in the grey market, and they are expected to be listed at ₹138 on NSE SME, which is 27.78% higher than the IPO price of ₹108.
Company Overview
Deccan Transcon Leasing is a company that offers tank containers on lease and provides logistics and supply chain solutions. They offer comprehensive freight and shipping solutions, including domestic container logistics, tank fleet management, customs clearance and transportation, and NVOCC services. The company mainly serves customers in industries such as chemicals, pharmaceuticals, FMCG, agriculture, and others, focusing on speciality chemicals and petrochemicals. They have agencies in various regions, handling logistics operations for both inbound and outbound cargo movement.
SWOT Analysis
| STRENGTHS | WEAKNESSES |
| The company offers specialized tank container leasing and logistics services, catering to specific industry needs.Deccan Transcon Leasing has a presence in 40 countries, allowing them to serve a wide range of clients.Their network of agencies in various regions facilitates smooth logistics operations. | The company’s revenue has fluctuated over the past few years, indicating potential challenges in maintaining consistent business.Focus on specific sectors like chemicals and pharmaceuticals might make the company vulnerable to industry-specific downturns.The logistics industry is highly competitive, with numerous players offering similar services. |
| OPPORTUNITIES | THREATS |
| The expansion of these industries can drive demand for tank container leasing and logistics services.The growth of e-commerce and retail can create new opportunities for logistics providers.Government initiatives to improve transportation infrastructure can benefit the company’s operations. | A slowdown in the global economy can impact demand for logistics services.Changes in regulations, particularly related to international trade and transportation, can affect the company’s operations.Advancements in technology, such as autonomous vehicles or drones, could disrupt the traditional logistics industry. |
Financial Strength
Deccan Transcon Leasing has shown mixed financial performance over the past three years. Revenue fluctuated, rising from ₹15,319.4 lakhs in FY22 to ₹18,061.76 lakhs in FY23, then decreasing to ₹15,363.76 lakhs in FY24. However, the company’s profitability has seen an upward trajectory. Profit after tax rose from ₹519.1 lakhs in FY22 to ₹1,181.89 lakhs in FY24, representing a growth of 127.7%. The year-over-year growth in PAT from FY23 to FY24 was 38%.
Environ Systems Ltd.
| Offer Price | ₹53 – ₹56 per share |
| Face Value | ₹10 per share |
| Opening Date | 13 September 2024 |
| Closing Date | 18 September 2024 |
| Total Issue Size (in Shares) | 5,400,000 |
| Total Issue Size (in ₹) | ₹30.24 Cr |
| Issue Type | Book Built Issue IPO |
| Lot Size | 2000 Shares |
| Listing at | NSE, SME |
Envirotech Systems Limited is offering 5,400,000 shares to the public, raising up to ₹30.24 crores. The IPO is scheduled to be listed on the NSE SME, increasing the company’s shareholding from 13,390,000 to 18,790,000. Investors can bid for a minimum of 2000 shares, with a minimum investment of ₹112,000 for retail investors and ₹224,000 for HNIs. The allotment is expected on September 19th, and the listing is tentatively set for September 23rd.
Objectives of the IPO
Envirotech Systems plans to use the IPO proceeds for:
- Land and building acquisition for a new factory
- Funding working capital requirements
- General corporate expenses
- Issue expenses
GMP
The company’s shares did not have a grey market premium (GMP) ahead of the issue opening. This suggests that there was no significant trading activity for the shares in the unlisted market before the IPO.
Company Overview
Envirotech Systems Limited is a manufacturer of noise measurement and control solutions for industrial and commercial applications. They specialize in designing and supplying custom enclosures for noise reduction in machinery and mechanical equipment. The company’s competitive strengths include early entry into the Acoustic Insulation sector, experienced promoters, a skilled technical team, a focus on research and development, strategic partnerships, product testing and certifications, and a strong customer base.
SWOT Analysis
| STRENGTHS | WEAKNESSES |
| The company specializes in noise measurement and control solutions, catering to a specific niche market.Envirotech Systems has a skilled technical team with expertise in noise reduction technology.Their focus on research and development allows them to stay ahead of industry trends and introduce innovative products.The company has demonstrated impressive growth in revenue and profitability. | While they specialize in noise control solutions, diversification into other environmental products might be beneficial.The company’s operations may be concentrated in a specific region, limiting their growth potential. |
| OPPORTUNITIES | THREATS |
| Growing awareness of environmental issues can drive demand for noise control solutions.Expansion of industries can create new opportunities for Envirotech Systems’ products.Government regulations aimed at reducing noise pollution can benefit the company. | The market for environmental products and services is competitive, with other players offering similar solutions.A slowdown in the economy can impact demand for industrial and commercial products.Changes in environmental regulations can affect the company’s operations and product requirements. |
Financial Strength
Envirotech Systems’ Revenue increased from ₹1,849.54 lakhs in FY22 to ₹4,687.95 lakhs in FY24, marking a growth of 153.5%. The year-over-year growth from FY23 to FY24 was 63%. Profit after tax also increased, rising from ₹105.73 lakhs in FY22 to ₹1,142.88 lakhs in FY24, representing a growth of 981%. The year-over-year growth in PAT from FY23 to FY24 was 344%, indicating improved operational efficiency and cost management.
In conclusion, today’s IPO landscape offers a variety of investment opportunities across different sectors. Investors can choose from the mainboard IPO of Western Carriers (India) Limited or the SME IPOs of Envirotech Systems Limited, Deccan Transcon Leasing Limited, and Popular Foundations Limited. Each company presents unique prospects and challenges, making it essential for investors to conduct thorough research before making investment decisions.
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I’m Archana R. Chettiar, an experienced content creator with
an affinity for writing on personal finance and other financial content. I
love to write on equity investing, retirement, managing money, and more.
