Delhivery IPO Opened Today: All you need to know
Shivani Bhati | May 11, 2022 |
Delhivery IPO Opened Today: All you need to know
The Rs 5,235 crore initial public offering of Delhivery, India’s largest logistics service provider, will begin accepting subscriptions today, Wednesday, May 11 and end on Friday, May 15. After LIC, this is Dalal Street’s second largest IPO in calendar year 2022 (CY22). For its Rs 5,235-crore first share offer, the business has established a price range of Rs 462-487 per share. Between 2019 and 2021, the firm saw strong growth, with a CAGR of 49%. However, the business has been unable to reduce its losses. The company’s main task is to provide logistical services. Among other services, Delhivery provides quick parcel delivery, heavy cargo transportation, storage, and payment collecting.
The business has set aside Rs 20 crore in shares for staff, who will get them at a discount of Rs 25 off the final offer price. The offer’s price band has been set at Rs 462-487 per share, with the offer closing on May 13.
Delhivery plans to raise Rs 5,235 crore through a public offering that includes a new issue of Rs 4,000 crore and a shareholder offer for sale of Rs 1,235 crore.
The corporation has set aside 10% for individual retail investors (RII). Qualified institutional purchasers will get about 75% of the entire offer (QIB). The corporation has set aside 15% for non-institutional investors (NII).
CA Swift Investments, a Carlyle Group subsidiary, will sell shares for Rs 454 crore. Softbank Group’s SVF Doorbell (Cayman) Ltd would sell shares for Rs 365 crore. Deli CMF Pte Ltd, a wholly-owned subsidiary of China Momentum Fund, L.P., would sell Rs 200 crore in shares, while Times Internet will sell Rs 165 crore in shares.
The co-founders of Delhivery, Kapil Bharati, Mohit Tandon, and Suraj Saharan, will also sell shares worth Rs 5 crore. Rs 40 crore and Rs 6 crore, respectively.
According to its share-sale prospectus, Delhivery has never made a profit. For the nine months ending December 2021, the firm lost Rs 891.14 crore, compared to a Rs 415.7 crore loss in FY21. In the nine months ended December, revenue was Rs 4,911 crore, compared to Rs 3,838 crore in FY21.
In FY21, it had a negative free cash flow of Rs 246 crore, compared to Rs 848 crore the previous year. In the first nine months of FY22, freight, handling, and maintenance charges increased to Rs 3,480 crore, up from Rs 2,026 crore in FY21.
The company’s annualised sales will be Rs 6,413 crore, with a price-to-sales ratio of 5.5x. Other logistics businesses are profitable. TCI Express, Blue Dart, Gati, VRL Logistics, and Mahindra Logistics is less than the expected market cap of Delhivery of about Rs 35,000 crore.
According to market experts, throughout the weekend, Delhivery shares are available in the grey market for a premium (GMP) of Rs 16. From a high of Rs 950 a share in January, Delhivery shares have dropped nearly 40% on the unlisted market. According to an analyst, the stock is now trading at Rs 550-600 on light trading volumes.
The views expressed are strictly of the author. The contents of this article are solely for informational purpose and for the reader’s personal non-commercial use. It does not constitute professional advice or recommendation by Author or Studycafe. Neither the author nor Studycafe and its affiliates accepts any liabilities for any loss or damage of any kind arising out of any information in this article nor for any actions taken in reliance thereon.
In case of any Doubt regarding Membership you can mail us at [email protected]
Join Studycafe's WhatsApp Group or Telegram Channel for Latest Updates on Government Job, Sarkari Naukri, Private Jobs, Income Tax, GST, Companies Act, Judgements and CA, CS, ICWA, and MUCH MORE!"
