TVS Supply Chain Solutions IPO records 55% booking on debut

TVS Supply Chain Solutions' initial public offering (IPO) was for 2.51 billion shares, and it got bids for 1.37 billion equity shares on its debut day, August 10. This is a subscription rate of 55 percent.

High net worth individuals purchased 69% of their quota, which was 15% of the IPO size, and retail investors purchased 1.71 times their quota, which was 10% of the IPO size.

Up to 75% of the issuance has been reserved for qualified institutional buyers (QIB), who have placed bids for 8% of the shares.

On August 14th, the deadline for public issue bids will be reached.

The TVS Mobility Group subsidiary anticipates raising Rs 880 crore at the upper end of the IPO pricing band of Rs 187-197 per share.

The company is issuing new shares worth Rs 600 crore, while 22 selling shareholders, including Omega TC Holdings and Tata Capital Financial Services, are offering to sell their shares for Rs 280 crore.

The anchor book at QIB contributed Rs 396 crore to the Chennai-based logistics company on August 9, a day before the issue launched.

SBI Life Insurance, Authum Investment, Franklin India Mutual Fund, Winro Commercial, Tata Mutual Fund, Societe Generale, Sundaram Mutual Fund, and Copthall Mauritius were among the many prestigious international and local investors who contributed to the anchor book.

In addition to general corporate reasons, the company plans to use the proceeds from the latest offer to pay down its debt by Rs 525 crore.

Borrowings for the supplier of supply chain logistics solutions totaled Rs 1,989.6 crore as of the fiscal year's end in March. This is up from Rs 1,763.8 crore in FY22 and Rs 1,547.9 crore in FY21.

Revenue increased by 10.7 percent to Rs 10,235.4 crore, and net income rose to Rs 41.76 crore from a loss of Rs 45.8 crore in the prior fiscal year, March FY22.

Earnings before interest, taxes, depreciation, and amortisation (EBITDA) grew by 11.6% year-over-year to Rs 683.65 crore in FY23, with the margin increasing by 5 basis points to 6.67 percent during the same time frame.

Due to the company's return to profitability after years of losses, TVS Supply Chain Solutions was able to report an EPS of Re 1 for the fiscal year ending on March 31, 2019, making it one of the fastest-growing integrated supply chain solutions providers. TVS Supply Chain Solutions manages large and complex supply chains for a variety of industries in India and a few other select global markets. The rate of return on capital employed increased to 7.6% from 6.7% in the previous year.

The TVS Mobility Group has established long-term partnerships with several clients, including Johnson Controls-Hitachi Air Conditioning India, Sony India, Hyundai Motor India, Ashok Leyland, Diebold Nixdorf, Daimler India Commercial Vehicles, Panasonic Life Solutions India, and Dennis Eagle, despite maintaining an asset-light business model.

At a compound annual growth rate (CAGR) of 13%, the Indian logistics market is projected to increase from its current level of $205 billion in FY22 to $385 billion in FY27.

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