Western Carriers (India) Limited IPO: Check Issue Date, Price, and Other Key Details
Kolkata-based logistics company Western Carriers (India) Limited has received SEBI’s approval to launch its initial public offering (IPO). The company is among several firms looking to raise capital from the public due to buoyant markets.
About Western Carriers (India) Ltd .
Western Carriers (India) Ltd. is India's largest private, multi-modal, rail-focused, fourth-party asset-light logistics company in terms of container volumes in fiscal 2022. Based on container volumes handled, its domestic and EXIM market share was 7% and 3%, respectively, in fiscal 2022. The company has five decades of experience in road, rail, and sea/river multi-modal movement for domestic and EXIM cargo in and out of India.
The firm's multi-modal logistics services include road, railway, ocean/coastal/river, and air logistics. It also provides chartering services to overseas destinations, stevedoring services at Indian ports, and coastal movement of cargo within India.
Western Carriers (India) Pvt Ltd. IPO: Important details
The company's IPO consists of a fresh issue and an offer for sale. Here are the key details of this IPO:
| Particulars | IPO Details |
|---|---|
IPO opens on | To be announced |
IPO closes on | To be announced |
Fresh issue size | ₹500 crores |
Number of equity shares offered in offer for sale | Up to 9,328,995 equity shares |
Minimum lot size | To be announced |
Minimum investment amount | To be announced |
Book running lead managers | JM Financial Ltd Kotak Mahindra Capital Company Ltd |
Offer registrar | Link Intime India Pvt Ltd |
Utilisation of IPO proceeds
The company plans to utilise proceeds received from the IPO to:
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Prepay or scheduled repayment of a portion of certain outstanding borrowings —The company intends to use up to ₹200.239 crores for this.
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Fund capital expenditure requirements of the company towards purchase of:
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Commercial vehicles - To grow revenue from freight, handling, agency and other charges, it intends to utilise a portion of the net proceeds aggregating to ₹138.825 crores to purchase trucks and flatbed trailers for its business.
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40 feet specialised containers and 20 feet normal shipping containers - It intends to utilise an amount aggregating to ₹34.536 crores to purchase 40 feet specialised containers and 20 feet normal shipping containers for purposes of multi-modal transportation.
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Reach stackers - For this, the company plans to utilise an amount aggregating to ₹12.741 crores.
The remaining amount is to be utilised for general corporate purposes.
Financial overview
Given below are some key financials of the company across different financial years:
| Particulars | FY 22 | FY 21 | FY 20 |
|---|---|---|---|
Total equity and liabilities (in ₹ crores) | 490.329 | 425.215 | 358.523 |
Total income (in ₹ crores) | 1475.789 | 1113.897 | 1073.527 |
Profit after tax (in ₹ crores) | 61.129 | 44.528 | 35.858 |
Basic and diluted earnings per share (in ₹) | 7.77 | 5.66 | 4.56 |
EBITDA (in ₹ crores) | 108.887 | 84.618 | 79.421 |
Offer structure
Western Carriers (India) Ltd.’s IPO is being made through the book building process. The table highlights the percentage of offer size allocated for different category of investors:
| Investor category | Percentage of offer size |
|---|---|
Qualified institutional bidders | Not more than 50% of the offer |
Non-institutional bidders | Not less than 15% of the offer |
Retail individual bidders | Not less than 35% of the offer |
Competitive strengths of Western Carriers (India) Ltd .
Here are some of the key competitive strengths of Western Carriers (India) Limited IPO:
- Experience in delivering customised, end-to-end services and executing complex and bespoke projects
- Comprehensive and integrated multi-modal, end-to-end logistics solutions
- Strong customer relationships with a diverse customer base
- Strategically positioned to capitalise on a fast-growing logistics market in India
- Scaled, asset-light business model with a successful track record of delivering growth and profitability, and experience of promoters
Business strategies
Going forward, the company has outlined the following business strategies:
- Grow its relationship with its existing customers
- Acquire new customers and expand into new sectors and geographies
- Continued focus on improving margins
- Pursue inorganic growth on an opportunistic basis
- Continue to invest in its infrastructure capabilities
- Enhance its technology capabilities
Industry overview
According to the 1 Lattice Report, the multi-modal (rail-road) market in India was around ₹1,355 billion in fiscal 2022, which is expected to grow to ₹4,112 billion by fiscal 2027, growing at a CAGR of 25%. The report also said that the share of the multi-modal (rail-road) market was approximately 9% of the total transportation market in fiscal 2022, which is expected to grow close to twice the size to 16% by fiscal 2027.
Also, the Indian logistics industry is set to grow owing to a rise in exports and imports, an increase in domestic manufacturing activity, growth in e-commerce, and government policy initiatives such as the PM Gati Shakti National Master Plan for Multi-modal Connectivity. The industry is expected to increase steadily at a CAGR of approximately 11%, reaching approximately ₹30 trillion by fiscal 2027.
In conclusion
Check with your broker on the process to apply for this IPO when it opens for subscription. However, before that, factor in your financial goals and risk tolerance. Go through the company's red herring prospectus for a detailed overview of its various aspects.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. It is not produced by the desk of the Kotak Securities Research Team, nor is it a report published by the Kotak Securities Research Team. The information presented is compiled from several secondary sources available on the internet and may change over time. Investors should conduct their own research and consult with financial professionals before making any investment decisions. Read the full disclaimer here.
Investments in securities market are subject to market risks, read all the related documents carefully before investing. Please read the SEBI prescribed Combined Risk Disclosure Document prior to investing. Brokerage will not exceed SEBI prescribed limit.
