Western Carriers IPO subscribed 4.82 times on Day 2. Check GMP, other details

The initial public offering (IPO) of Western Carriers was oversubscribed by 4.82 times as of day 2, receiving over 10.06 crore consolidated share bids by 5 pm on Monday, against 2,08,68,467 shares available for subscription. The retail portion received a solid response, with 7.3 times subscription.

The non-institutional investors (NIIs) portion was subscribed 5.35 times while the quota reserved for qualified institutional buyers (QIBs) was subscribed only 3%.

The IPO comprises a fresh equity sale of Rs 400 crore and an offer for sale (OFS) of up to 54 lakh shares by promoter selling shareholder Rajendra Sethia.

Western Carriers IPO price band
The company has fixed a price band of Rs 163-172 per share, where investors can bid for 87 shares in one lot.

Western Carriers IPO GMP
In the unlisted market, the company’s shares were commanding a grey market premium of Rs 55 per equity share. This is a 32% premium over the upper band of the issue price.

Western Carriers IPO review
Analysts advised only high-risk investors to subscribe to the issue as the company faces a long payment cycle and is exposed to several operational risks.”Given the company’s financial challenges and limited market interest, a “may apply” rating is recommended for long-term investors with a high-risk tolerance,” said Swastika Investmart.

Other details
Proceeds from the fresh issue will be used to repay borrowings and fund capital expenditures for purchasing commercial vehicles, containers, and reach stackers, with any remaining funds allocated for general corporate purposes.

Western Carriers boast a pan-India presence with over 50 branch offices and four zonal offices across 23 states. The company operates 16 warehouses in 12 states and handles over 55 major public rake points throughout India. This extensive network allows it to offer both first-mile and last-mile connectivity to customers with operations across the country, including in remote areas.

As of March 31, 2024, the company served 1,647 customers across various industries, including metals, FMCG, pharmaceuticals, chemicals, and oil & gas. Key clients include Tata Steel, Hindalco Industries, HUL, and DHL.

For FY24, the company reported a 4% increase in consolidated revenue from operations to Rs 1,686 crore, while profit after tax (PAT) rose 12% to Rs 80.3 crore.

For the fiscal year 2024, the company reported revenue of Rs 1,685 crore and a PAT of Rs 80 crore. JM Financial and Kotak Mahindra Capital Company are the book-running lead managers for the IPO. The equity shares will be listed on BSE and NSE.

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