Muted Listing: Zinka Logistics Solution Shares List At 3% Premium From IPO Price On Exchanges; BUY?

Zinka Logistics Solution Limited, the parent company of the BlackBuck app, made its debut on the stock exchanges on Friday, November 22, with a subdued listing. On the National Stock Exchange (NSE), the shares opened at Rs 280.90, reflecting a 2.89% premium over the issue price of Rs 273. Meanwhile, on the Bombay Stock Exchange (BSE), they debuted at Rs 279.05, up 2.22% from the IPO price.

Zinka IPO Subscription

Zinka's Rs 1,114.72 crore IPO was open for subscription from November 13 to November 18 and closed with robust demand, achieving 1.87 times the overall subscription. The offering consisted of a fresh issue of Rs 550 crore and an offer for sale of Rs 564.72 crore.

The IPO received bids for 4.19 crore shares against 2.24 crore shares on offer. Notably, the employee quota was oversubscribed 9.86 times. The qualified institutional buyers (QIB) segment witnessed a subscription rate of 2.72 times. However, the non-institutional investors (NII) segment lagged, with only 0.24 times subscription, while the retail segment saw healthy participation at 1.70 times.

IPO Details

Zinka Logistics set the IPO price band at Rs 259 to Rs 273 per equity share, with a minimum application size of 54 shares, requiring a minimum investment of Rs 14,742. The issue included a reservation for up to 26,000 shares for employees at a discounted rate of Rs 25 per share.

The company raised Rs 501.33 crore from anchor investors on November 12, 2024, before opening the subscription window. The IPO's proceeds are earmarked for key objectives, including sales and marketing expenses, strengthening the capital base of its NBFC subsidiary, BlackBuck Finserve Private Limited, funding product development initiatives, and general corporate expenses. Post-IPO, the promoter shareholding in Zinka Logistics will reduce from 32.91% to 27.84%.

About Zinka Logistics Solution

Founded in April 2015, Zinka Logistics Solution operates BlackBuck, a digital platform designed for truck operators. BlackBuck is one of India's largest digital ecosystems for the trucking industry, facilitating freight marketplaces, payments, telematics, and vehicle financing.

In FY24, BlackBuck engaged with 9,63,345 truck operators, representing 27.52% of India's total trucking operators. The platform also managed significant transaction volumes, with a Gross Transaction Value (GTV) of Rs 17,396.2 crore in payments as of March 31, 2024. Furthermore, it managed an average of 3,56,050 active telematics devices monthly and facilitated 4,035 loans worth Rs 196.8 crore.

Financial Performance

Zinka Logistics has demonstrated strong financial growth. In FY24, the company reported a 62.24% increase in revenue, alongside a 33.24% year-on-year rise in profit after tax (PAT).

Lead Managers

The IPO was managed by an impressive lineup of lead managers, including Axis Capital Limited, Morgan Stanley India Company Pvt Ltd, JM Financial Limited, and IIFL Securities Ltd. KFin Technologies Limited served as the registrar for the issue.