Western Carriers IPO Sees Massive Demand, Subscribed 3.47x on Day 2 – Check GMP, Key Details Now

The Western Carriers IPO has been oversubscribed by 3.47 times on the second day of bidding. As of 2 PM on Monday, the IPO received bids for over 7.25 crore shares, while only 2,08,68,467 shares are available for subscription. The retail investor segment saw a strong response with 5.55 times subscription.

For non-institutional investors (NIIs), the subscription was 3.18 times, while the quota for qualified institutional buyers (QIBs) saw less interest, with only 1% subscription. QIBs have submitted 37,497 share bids out of the 58,98,528 shares reserved for them.

IPO Details

The IPO includes a fresh equity issue worth ₹400 crore and an offer for sale (OFS) of 54 lakh shares by the promoter, Rajendra Sethia. The price band for the IPO is set at ₹163-₹172 per share, with a minimum bid of 87 shares per lot.

Grey Market Premium (GMP)

In the grey market, Western Carriers shares are trading at a premium of ₹55 per share, which is 32% higher than the upper issue price of ₹172.

Expert Opinion

Market analysts suggest that only high-risk investors should consider subscribing to this IPO due to the company’s long payment cycles and operational risks. Swastika Investmart gave the IPO a “may apply” rating, recommending it mainly for long-term investors who can handle higher risks.

Use of Funds

The funds raised from the fresh issue will be used to repay debts and invest in capital expenditures, such as purchasing commercial vehicles, containers, and reach stackers. Any remaining funds will go towards general corporate expenses.

Company Overview

Western Carriers is a logistics company with a nationwide network. It operates more than 50 branch offices and four zonal offices in 23 states. The company manages 16 warehouses across 12 states and serves over 55 public rake points throughout India. This allows Western Carriers to provide full logistics support, including first-mile and last-mile delivery, even in remote areas.

As of March 31, 2024, the company had 1,647 customers from various industries like metals, FMCG, pharmaceuticals, chemicals, and oil & gas. Major clients include Tata Steel, Hindalco Industries, HUL, and DHL.

Financial Performance

For FY24, Western Carriers reported a 4% increase in revenue, reaching ₹1,686 crore, while its profit after tax (PAT) grew by 12% to ₹80.3 crore. JM Financial and Kotak Mahindra Capital Company are the lead managers for the IPO, and the company’s shares will be listed on both BSE and NSE.