Zinka Logistics IPO Subscribed 1.86 Times On Day Three As QIB Bids Pour In—Check GMP
Qualified institutional buyers led the demand for Zinka Logistics' IPO, as they booked 2.76 times their allotted portion. The retail quota was subscribed 1.66 times.
The initial public offering of Zinka Logistics Solutions Ltd., the parent of digital trucking solutions platform Blackbuck, was subscribed 1.86 times on its third day on Monday. The offer was booked 32% on the second day and 24% on the first day of bidding.
The grey market premium was nil as of 05:00 p.m., implying no gains over the IPO price, according to InvestorGain platform. The GMP has eroded after being reported as high as Rs 24 on Nov. 11, which implied a listing day gain of 8.79%. However, the GMP is not an official price quote for the stock and is based on speculation.
The price band for Zinka Logistics' IPO was set in the range of Rs 259-273 per share. The Rs 1,114.7-crore offer consists of a fresh issue of shares worth Rs 550 crore, and an offer-for-sale of up to Rs 565 crore, according to the red herring prospectus filed with the Securities and Exchange Board of India.
In the OFS portion, promoters Rajesh Kumar Naidu Yabaji, Ramasubramanian Balasubramaniam, and Chanakya Hridaya will sell a combined 44.38 lakh shares, along with other investors such as Accel India IV, Peak XV Partners, and the International Finance Corporation.
Axis Capital Ltd., Morgan Stanley India Co., JM Financial Ltd. and IIFL Securities Ltd. are the book running lead managers of the BlackBuck IPO, while KFin Technologies Ltd. is the registrar for the issue.
ALSO READ
NTPC Green Energy IPO: Check GMP And All You Need To Know About India's 3rd Largest IPO In 2024
Zinka Logistics (Blackbuck) IPO Key Details
Issue opening date: Nov. 13.
Issue closing date: Nov. 18.
Issue price: Rs 259-273 per share.
Fresh issue size: Rs 550 crore.
OFS size: Rs 565 crore.
Total issue size: Rs 1,114.7 crore.
Market value at the upper end of price band: Rs 4,818 crore.
Lot size: 54 shares.
Zinka Logistics (Blackbuck) IPO: Use Of Proceeds
Proceeds from the issue will be used as follows:
Funding towards sales and marketing costs: Rs 200 crore.
Investment in Blackbuck Finserve Pvt.: Rs 140 crore.
Funding of expenditure in relation to product development: Rs 75 crore.
Zinka Logistics (Blackbuck) Business
Zinka Logistics is the parent of digital trucking services platform Blackbuck, which is backed by Flipkart. It offers a variety of digital logistics services, including vehicle financing, fuel cards, FASTag services, and a marketplace connecting truck operators with businesses in need of transportation services.
Founded in 2015, BlackBuck entered the unicorn club in 2021, having raised over $350 million to date. The company has around 9.63 lakh customers on its platform.
As of Aug. 31, 2024, the company's outstanding borrowings on a consolidated basis aggregated to Rs 151.53 crore, as per their red herring prospectus.
Zinka Logistics (Blackbuck) IPO: Key Risks
Revenue dependency on partners: The company relies heavily on business partners for its payments and vehicle financing offerings. The loss of key partners could significantly impact financial performance.
Core revenue from payments and telematics: Payments and telematics offerings contribute around 93% of total revenue. Any downturn in these areas could materially harm the company's financial health.
Revenue from commissions and subscriptions: Commission income (41%) and subscription fees (39%) make up a substantial portion of revenue. Fluctuations in these income streams could negatively affect business performance.
Risks in vehicle financing: The company's relatively new vehicle financing offering exposes it to risks from high-risk borrowers and challenges with collateral recovery.
Limited experience in vehicle financing: With limited expertise in vehicle financing, the company faces difficulties in predicting industry risks, which could have adverse consequences on its operations and financial condition.
Zinka Logistics (Blackbuck) IPO Subscription Status: Day 3
The IPO was subscribed 1.86 times as of 07:00 p.m. on Monday.
Qualified institutional buyers: 2.76 times.
Non-institutional investors: 0.24 times or 24%.
Retail investors: 1.66 times.
Portion reserved for employees: 9.88 times.
Zinka Logistics (Blackbuck) IPO GMP Today
The grey market premium of Blackbuck was nil as of 05:00 p.m., implying no gains over the IPO price, according to InvestorGain. The estimated listing price based on the GMP is Rs 273 per share.
GMP is not an official price quote for the stock and is based on speculation.
Watch The IPO Adda Here
Disclaimer: Investments in initial public offerings are subject to market risks. Please consult with financial advisors and read the red herring prospectus thoroughly before placing bids.
