Pranik Logistics Makes Tepid Market Debut: Shares List at ₹79, Just 2.5% Above IPO Price

Pranik Logistics made a quiet entry into the stock market today. The company’s shares were listed at ₹79 on the NSE SME exchange, which is only 2.5% higher than its IPO price of ₹77.

IPO Details

The IPO, worth ₹22.47 crore, was open for subscription from October 10 to October 14, 2024. The price range for the shares was set between ₹73 and ₹77 each.

The IPO saw a huge response, with an overall subscription of 218.02 times. Investors bid for 42.2 crore shares, even though only 19.36 lakh shares were available. Retail investors subscribed 97.21 times, while the Non-Institutional Investors (NII) category was oversubscribed 744.05 times. Qualified Institutional Buyers (QIB) showed interest too, subscribing 35.67 times.

Fresh Issue of Shares

The entire Pranik Logistics IPO was a fresh issue of 29.18 lakh shares, with no existing shares being sold by the promoters. On October 9, 2024, the company raised ₹6.32 crore from anchor investors. Retail investors had to apply for a minimum of 1,600 shares, meaning they needed to invest at least ₹1.23 lakh.

Pranik Logistics plans to use the money for upgrading technology, covering capital expenditures, and managing working capital. Some funds will also go towards general corporate purposes and IPO-related expenses.

Narnolia Financial Services Ltd was the lead manager of the issue, and Maashitla Securities Private Limited was the registrar. Prabhat Financial Services was the market maker for the IPO.

Expert Opinion

According to Dilip Davda from Chittorgarh.com, Pranik Logistics operates in a highly competitive and fragmented industry. Although the company has shown steady growth, there was a significant increase in profits just before the IPO, raising concerns about whether this growth can be sustained. He added that the issue seems fully priced based on FY25 earnings and that long-term investors with extra funds could consider investing.

About Pranik Logistics

Founded in 2015, Pranik Logistics offers logistics solutions across India. They provide transportation, warehousing, material handling, and freight forwarding services to sectors such as retail, telecom, consumer durables, manufacturing, and pharmaceuticals. The company operates a fleet of 86 commercial vehicles and manages 30 warehouses. Between March 2023 and March 2024, Pranik Logistics saw an 11% rise in revenue and a 336% increase in profit after tax (PAT).