Kerala-based automobile dealer Popular Vehicles and Services Ltd has set the price band at Rs 280-295 a share for its initial public offering that will open for subscription on March 12.
The anchor bidding will open on March 11 and the issue will close on March 14. The finalisation of the basis of allotment will be on March 15, while initiation of refunds is scheduled for March 18. The stock will be listed on exchanges on March 19.
The IPO comprises a fresh shares of Rs 250 crore by the company, and an offer-for-sale (OFS) of 11.92 million shares by private equity fund BanyanTree Growth Capital II LLC.
On the upper price band of the issue, the total IPO size comes at a little over Rs 600 crore and market capitalisation stands at Rs 1,450 crore.
Promoters hold 69.45 percent in the company and the remaining stake is owned by public shareholders, including BanyanTree, which is the largest shareholder in the company. Three promoters - John K Paul, Francis K Paul, and Naveen Philip - own 23.15 percent each.
The automobile dealer plans to spend Rs 192 crore out of the net fresh issue on repaying debt of its own and of certain subsidiaries, while the rest will be kept for general corporate purposes. As of December 2023, the amount of consolidated debt on its books was Rs 637.06 crore.
The company caters to the complete life cycle of vehicle ownership, right from the sale of new vehicles, servicing and repairing vehicles, distributing spare parts and accessories, to facilitating sale and exchange of pre-owned vehicles, operating driving schools and facilitating the sale of third-party financial and insurance products has recorded 90.3 percent on-year growth in net profit at Rs 64.07 crore for the financial year ended March FY23, though there was a bit of pressure on the operating margin front.
Revenue from operations grew by 40.65 percent to Rs 4,875 crore compared to previous year. Its EBITDA (earnings before interest, tax, depreciation and amortisation) increased by 35.5 percent to Rs 217.2 crore during the same period with margin falling to 4.45 percent, from 4.6 percent in previous year. Net profit for six months period ended September FY24 stood at Rs 40 crore on revenue of Rs 2,835 crore.
Popular Vehicles categorises its automobile dealership business into three key segments - passenger vehicles, including luxury vehicles, commercial vehicles, and electric two-wheeler and three-wheeler vehicles. It operates dealerships for Maruti Suzuki India, Honda Cars India, Jaguar Land Rover India, Tata Motors, Daimler India Commercial Vehicles, Piaggio Vehicles, and Ather Energy.
ICICI Securities, Nuvama Wealth Management, and Centrum Capital are acting as the merchant bankers to the issue.
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