Western Carriers (India) Limited – About the Company
Western Carriers Limited is one of the largest private rail-focused, 4PL asset-light logistics companies in India. The company is operating in a scalable asset-light model that allows it to offer differentiated 3PL and 4PL solutions.
The company is striving to convolutions by creating customised, one-stop or single-window, end-to-end and integrated logistics solutions for its customers, that include a variety of value-added services across the supply chain system.
As of December 31, 2022, the company is running the 400 GPS-enabled heavy commercial vehicles, over 400 shipping containers, 13 light commercial vehicles and 27 reach stackers. Further, with the funds raised through IPO, the company will purchase more, commercial vehicles shipping containers and reach stackers to enhance its logistics handling capacity.
Western Carriers (India) Limited operates with five decades of experience in road, rail and sea/river multi-modal logistics and supply chain services for domestic as well as EXIM (Export-Import)cargo in and out of India. With a strong presence in the domestic and EXIM markets, the company has attained market share of 7% and 3%, respectively, based on container volumes handled in the same fiscal year.
Western Carriers (India) Limited IPO Details:
| IPO Open Date | September 13, 2024 |
| IPO Close Date | September 18, 2024 |
| Basis of Allotment | September 19, 2024 |
| Listing Date | September 23, 2024 |
| Face Value | ₹5 per share |
| Price | ₹163 to ₹172 per share |
| Lot Size | 87 Shares |
| Total Issue Size | 28,655,813 shares |
| (aggregating up to ₹492.88 Cr) | |
| Fresh Issue | 23,255,813 shares |
| (aggregating up to ₹400.00 Cr) | |
| Offer For Sale | 5,400,000 shares of ₹5 |
| (aggregating up to ₹92.88 Cr) | |
| Issue Type | Book Built Issue IPO |
| Listing At | BSE & NSE |
| QIB Shares Offered | Not more than 50% of the Net Issue |
| Retail Shares Offered | Not less than 35% of the Net Issue |
| NII (HNI) Shares Offered | Not less than 15% of the Net Issue |
| Promoters | Rajendra Sethia and Kanishka Sethia |
Western Carriers (India) Limited IPO Objectives
The company is going to raise around Rs. 492.88 crores, through this IPO and going to use the fund for the repayment of a portion of certain borrowings owned by the company that has increased its financing cost denting its bottom-line margins.
Also Read: What is IPO: How it Works & Else Everything You Need To know
As per the draft red hearing prospects, the IPO issue consists of an Offer for sale by promoter amounting to Rs. 92.88 crores. Nothing from those proceeds of OFS will be allotted to company.
As per IPO prospectus, the IPO has fresh issue of 400 crores. Out of total sum, Rs. 163.50 crores will be used to pay some of debt, Rs. 151.70 crores will be used for capex and rest of the amount will be used for corporate general expenses.
Western Carriers (India) Limited IPO Issue Price & Size
Western Carriers (India) Limited IPO issue price has been declared in price range of Rs. 163 to Rs. 172.
Western Carriers (India) Limited IPO Launch Date
Western Carriers (India) Limited IPO launch date has been officially announced for Sep 13. The IPO will close on Sep 18, 2024. The listing of IPO will be done of sep 23, 2024.
Western Carriers (India) Limited Financial Statements:
| Particulars in (Rs Cr.) | FY23 (9M) | FY22 | FY21 | FY20 | CAGR |
| Revenue from Operations | 1206.9 | 1470.88 | 1110.11 | 1067.29 | 17.40% |
| Other Income | 3.71 | 4.91 | 3.79 | 6.24 | |
| Operating expenses | 1043.21 | 1280.41 | 960.72 | 925.63 | |
| Employee Cost | 31.41 | 37.04 | 27.71 | 27.73 | |
| Other expenses | 40.18 | 49.46 | 40.86 | 40.75 | |
| EBITDA | 95.81 | 108.88 | 84.61 | 79.41 | 17.10% |
| EBITDA Margin% | 7.94% | 7.40% | 7.62% | 7.44% | |
| Depreciation | 10.95 | 11.6 | 11.59 | 13.59 | |
| Interest | 10.89 | 13.92 | 13.00 | 13.73 | |
| Profit / (loss) before tax | 73.97 | 83.36 | 60.02 | 52.09 | |
| Total tax | 18.89 | 22.24 | 15.50 | 16.24 | |
| Profit After Tax | 55.09 | 61.12 | 44.52 | 35.85 | 30.60% |
| PAT Margin% | 4.56% | 4.16% | 4.01% | 3.36% |
Western Carriers (India) Limited Financial Performance
The revenue of the Western Carriers (India) Limited has grown at a CAGR of 17.40% during the two years and nine months from FY20 to FY23. In FY20 the Revenue was Rs. 1067.29 crore which reached at Rs. 1206.9 crore in FY23(9M).
The operating profit of the company also grew at a CAGR of 17.10% during the same period. In FY20 the EBITDA was Rs 79.41 crore which surged to Rs 95.81 crore. The EBITDA Margin% was 7.94% in the first nine months of FY23 which has marginally improved from 7.44% in FY20. The EBITDA margins showed muted growth due to increased operating expenses.
The Profit After Tax of the company stood at Rs. 55.09 crore in the first nine months of FY23 from Rs 35.85 crore in FY20, registering a CAGR growth of 30.60% during the same period. However, the PAT Margin of the company improved to 4.56% in FY23 from 3.36% in FY20.
Western Carriers (India) Limited IPO Promoters & Shareholding of the Company
Rajendra Sethia is whole and sole promoter of the company holding 78,689,200 equity shares or 99.99% of the total shares in the company. With this IPO he is going to sell around 9,328,995 equity shares through an offer for sale.
| S.No. | Name of the Shareholder (Promoters & Promoters Group) | Pre-Offer No. of Equity Shares | % of total pre-Offer paid up Equity Share capital(%) |
| 1 | Rajendra Sethia | 78,689,200 | 99.99% |
| S. No. | Name of the Selling Shareholder | Number of Equity Shares being offered in the Offer for Sale (Up to) | |
| 1 | Rajendra Sethia | 9,328,995 Equity Shares |
Why Invest in Western Carriers (India) Limited IPO?
Investing in Western Carriers (India) Limited IPO or in any other company you need to check its business model, scope of business, financial growth and various other factors that will drive its revenue growth in the near future. In respect of the same, we brought her the strength that will help it to maintain the growth momentum and risk associated with the company while operating its business in various market conditions or while competing with its rivals.
Strengths:
- Western Carriers Limited offers multi-modal integrated, customized, end-to-end services across the logistics value chain to its customers. It is one the few players in the Indian logistics industry operating with the capability to deliver cost-effective, time-bound, and customized services and solutions to its clients across the regions.
- The promoters and company have over five years decades of experience in executing logistics supply chain projects. Western Carriers Limited is capable of accepting the challenges evolved through the changes in the logistics industry making it one of the preferred partners for its customers.
- The company has strong customer relationships with a diverse customer base of 1100. Furthermore, it has maintained long-lasting relationships with the leading players in the industry from varied sectors like chemicals, oil and gas, metals, building materials, textile, power, utilities, mining, pharmaceuticals and FMCG.
- The top customers of Western Carriers are well-known companies including Tata Steel, Vedanta, Tata Consumer Products, Hindalco Industries, Cipla, JSW, BALCO, Coca-Cola India, Gujarat Heavy Chemicals, HUL, Haldia Petrochemicals, MCPI, BCPL, and DHL, among others.
- At the financial end, it has maintained the steady growth in the revenue and net profit showing the successfully delivering the growth and profitability.
- Over the past two years and nine months, it has shown a CAGR growth of 17.40% and 17.10% in the revenue and operating profit. While the company has its net profit margins and registered a Net Profit growth of around 30.6% in the same period.
Risks:
- The business of the company is highly concentrated within the limited number of customers which would be a risk for the company. Especially when these industries are affected due to economic factors and industry-related reasons can also affect the volume growth of the company.
- Western Carriers Limited is also very much dependent on the promoters and only a few key managerial personnel and senior management. Any kind of incapability of these management personnel or the company's inability to retain them could adversely affect the performance of the company, resulting in the revenue and earnings of the company will be also affected.
- Though the funds raised through IPO will be used to reduce the debt, in the near future inability to maintain the cash flow for the company will encourage again to borrow the debts. This will again impact the bottom line margins of the company due to an increase in the financing cost of the company.
- On the financial front, though the company has maintained steady growth in revenue and operating profits. However, the operating margins and bottom line margins of the company are still very low. At such narrow margins, there is a risk of incurring the loss, if any unexpected expenses or liabilities come.
Also Read: What are the Risk Factors Involved in Applying for an IPO
Western Carriers (India) Limited IPO Grey Market Premium
The Grey Market Premium (GMP) of Western Carriers (India) Limited IPO is not known as there is no issue price disclosed yet. The GMP is the price of a share of an unlisted company that launched the IPO and is likely to be listed after the allotment is done.
Also Read: What is Grey Market Premium in IPO: How is GMP Calculated &Reliable
The GMP is considered as per the demand and supply of the share in the grey market. During and before the listing of IPO shares, the GMP can fluctuate till the listing of the shares.
Western Carriers (India) Limited IPO Review & Analysis
Western Carriers Limited is the largest private rail-focused, rail-focused, 4PL asset-light logistics company in India. It operates with highly scalable and customised, one-stop or single-window, end-to-end and integrated logistics solutions for its customers creating an advantage for the company to offer a variety of value-added services across the supply chain system for different companies operating in diverse sectors and industries.
However, the price of the IPO is not yet known, hence the valuation and comparison with peer group companies is not possible right now. If the Western Carriers (India) Limited IPO is issued at a discounted price and cheaper than its listed competitors, then you can consider applying to enjoy the listing gain or can also keep it for long-term investment.
Also Read: What to Check Before Buying IPO: Things to Know & Is it Safe
However, if the Western Carriers (India) Limited IPO is issued at a high premium price, which means the valuation is high and also overpriced compared to its peer group companies, then you can avoid applying this IPO or buying the shares from the secondary market.
How to Apply for Western Carriers (India) Limited IPO?
To apply for the Western Carriers (India) Limited IPO you must have a trading and demat account. If you don’t have these two accounts, you can apply to open a trading and demat account at Moneysukh with the required documents to complete your KYC.
Once your trading account and demat account is open and Western Carriers (India) Limited IPO is launched you can follow the steps given below and apply.
Steps to Apply for Western Carriers (India) Limited IPO:
Step 1: When Western Carriers (India) Limited IPO opens check the applying date.
Step 2:Open trade.moneysukh.com in your browser and log in with your User ID & password.
Step 3:Now find the IPO section and select the Western Carriers (India) Limited IPO.
Step 4:Here you have to fill in important details like price, quantity, and so on.
Note: At the time of applying in any IPO, always bid at the cutoff price before submitting your application.
Step 5:Finally, make the payment and submit your IPO application successfully.
How to Check Western Carriers (India) Limited IPO Allotment Status?
Once the Western Carriers (India) Limited IPO bidding process ends, after a few days, the allotment process is conducted by the company. When allotment is done, you can easily check the allotment through various sources including from the Moneysukh site.
If the IPO is oversubscribed into multiple folds, then there is less of a chances of getting the allotment of shares IPO to everyone. If you have not been allotted any share, your IPO application money will be refunded into your bank account or the fund will be unblocked if you have applied through the UPI mandate.
Also Read: How to check IPO allotment status on NSE, BSE through Moneysukh
However, if you are lucky to get the allotment of shares, then before the date of listing you will get the allotment of shares that will be transferred into your demat account. Once the shares are visible in your demat account you can sell on the listing day if you get a high return on that day or can keep the stocks for the long-term investment growth.
Also Read: What to Know Before Investing in Stocks: 10 Things to Consider
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