Western Carriers India IPO Day 2: Subscription Status, GMP, and Key Insights

Synopsis : The Western Carriers India IPO has garnered moderate investor interest, with a 3.53x subscription on Day 2. The logistics company, offering shares priced between Rs 163-172, aims to raise Rs 492.88 crore, with a strong retail subscription but weaker interest from institutional buyers. The IPO's grey market premium indicates potential listing gains, and analysts recommend subscribing for long-term growth despite concerns over limited market interest and financial performance. The issue closes on September 18, with a tentative listing date of September 23.

Western Carriers India's Initial Public Offering (IPO) continued to see moderate investor interest on the second day of bidding. The company, a multimodal logistics provider, aims to raise Rs 492.88 crore through the offering, with shares priced between Rs 163-172. Investors are required to apply for a minimum of 87 shares or multiples thereof. The IPO includes a fresh issue of Rs 400 crore and an offer-for-sale (OFS) of 54 lakh equity shares.

As of Monday, September 16, investors had bid for 7.36 crore shares, which is 3.53 times the total issue size of 2.08 crore shares. The retail portion of the IPO was subscribed 5.62 times, while non-institutional investors (NIIs) subscribed 3.28 times. However, qualified institutional buyers (QIBs) showed limited interest, subscribing to only 1% of their allotted shares.

Western Carriers India, incorporated in 2011, operates an asset-light, multimodal logistics business, offering customizable logistics solutions across road, rail, water, and air transportation. It serves industries like FMCG, pharmaceuticals, chemicals, engineering, and more.

The grey market premium (GMP) for Western Carriers India has remained stable at Rs 57-60 per share, suggesting a potential listing gain of 33-35% for investors. While brokerages are largely positive on the IPO, highlighting its rising market share and attractive pricing, they also point out concerns about limited market interest and slow financial growth.

For the fiscal year ending March 31, 2024, Western Carriers India posted a net profit of Rs 80.35 crore and revenue of Rs 1,691.41 crore. In FY23, the company reported a net profit of Rs 71.57 crore on a revenue of Rs 1,637.84 crore. Ahead of its IPO, the company raised Rs 147.86 crore from 15 anchor investors.

Brokerages, including Arihant Capital, recommend subscribing to the IPO for long-term gains, noting the company's asset-light model, strong return ratios, and growing demand for logistics services. The IPO is expected to close on Wednesday, September 18, with the listing date tentatively set for Monday, September 23.

Disclaimer : This article is for informational purposes only and should not be construed as financial advice. Investors are advised to consult with a qualified financial advisor before making any investment decisions.