TVS Supply Chain IPO Debut Sees 22% Booking
In a remarkable market debut, TVS Supply Chain Solutions witnessed substantial interest, with bids placed for 54.97 lakh equity shares on August 10. This significant response arrived against the backdrop of an Initial Public Offering (IPO) size of 2.51 crore shares, resulting in a 22% subscription rate.
Retail investors played a pivotal role in this IPO, displaying their enthusiasm by subscribing to 1.08 times the allocated quota, equivalent to 10% of the total IPO size. Meanwhile, the portion reserved for high net-worth individuals, accounting for 15% of the total issue size, saw a 7% subscription rate.
The bidding process for the public issue will remain open until August 14.
TVS Supply Chain Solutions, a subsidiary of the TVS Mobility Group, has laid out plans to secure Rs 880 crore from the IPO, with the upper limit of the price band set at Rs 187-197 per share.
The comprehensive offering includes a fresh issuance of shares worth Rs 600 crore by the company itself, coupled with an offer-for-sale of Rs 280 crore initiated by 22 selling shareholders. This group includes notable entities such as Omega TC Holdings and Tata Capital Financial Services.
The Chennai-based logistics firm accomplished a successful anchor book raise on August 9, drawing Rs 396 crore from the Qualified Institutional Buyers (QIB) segment, just a day before the IPO’s official launch.
The anchor book saw participation from prominent domestic and global investors. Notable names in this list comprised SBI Life Insurance, Authum Investment, Franklin India Mutual Fund, Winro Commercial, Tata Mutual Fund, Societe Generale, Sundaram Mutual Fund, and Copthall Mauritius.
The capital acquired from the fresh issue of shares will be directed towards essential objectives, primarily focused on debt repayment amounting to Rs 525 crore. Additionally, these funds will be allocated for general corporate purposes.
With a borrowing amount of Rs 1,989.6 crore recorded at the close of the fiscal year ending in March FY23, TVS Supply Chain Solutions has witnessed an increase from Rs 1,763.8 crore in FY22 and Rs 1,547.9 crore in FY21.
Noteworthy financial growth was demonstrated in the last fiscal year, concluding in March FY23, as the company achieved a profit of Rs 41.76 crore, marking a significant turnaround from the Rs 45.8 crore loss incurred in FY22. Furthermore, the revenue exhibited a commendable growth rate of 10.7%, reaching Rs 10,235.4 crore.
The operating performance showcased a parallel trajectory of improvement. Earnings before interest, tax, depreciation, and amortisation (EBITDA) experienced an 11.6% YoY surge to Rs 683.65 crore in FY23, complemented by a 5 basis points margin expansion to 6.67% during the same period.
In FY23, TVS Supply Chain Solutions, a prominent player in the integrated supply chain solutions sector, demonstrated a positive earnings per share (EPS) of Re 1. This reflects a successful recovery from previous years of losses. Return on capital employed witnessed an upswing to 7.6%, surpassing the 6.7% figure recorded in the corresponding period.
As part of the TVS Mobility Group, the company has fostered enduring partnerships with esteemed 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.
Amidst a robust industry outlook, the Indian logistics sector is anticipated to achieve substantial growth, projecting a rise to $385 billion by FY27 at a Compound Annual Growth Rate (CAGR) of 13% from the $205 billion recorded in FY22.
About TVS Supply Chain:
TVS Supply Chain Solutions, an Indian multinational corporation, excels in providing transportation, logistics, and warehousing services. It serves a wide range of industries including automotive, consumer goods, defense, and utilities, delivering all-encompassing supply chain management remedies. Operating globally, the company has a presence in India, the United Kingdom, Europe, and the United States. TVS Supply Chain Solutions takes pride in its affiliation with the esteemed TVS Group of companies.
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