Ashapura Logistics Listing: Stock makes strong market debut, lists at 29% premium at ₹185

Ashapura Logistics made a healthy market debut today as its shares were listed at ₹185 each on NSE SME, indicating a premium of 28.5% over the issue price of ₹144.

The SME IPO, valued at ₹52.66 crore, was open for subscription from July 30 to August 01, 2024, at a price of ₹144 per share. It consisted solely of a fresh issue of 37.57 lakh newly issued shares, without any offer-for-sale component.

The IPO received a healthy response, with an overall subscription of 185 times. Retail investors showed significant interest, subscribing to it 174 times, while NII (Non-Institutional Investors) displayed strong enthusiasm with a subscription of 289 times.

The company plans to use the net proceeds from this issue for several key objectives:

Capital Expenditure: Purchase of trucks and ancillary equipment.

Warehouse Construction: Building warehouses at the Mundra, Gujarat, facilities.

Working Capital: Funding incremental working capital requirements.

General corporate purposes.

What does the company do?

As an integrated logistics provider in India, the company operates across various segments, including cargo handling and freight forwarding, transportation (which encompasses project logistics and third-party logistics), warehousing and distribution, and other services such as coastal movement. The company has a pan-India presence through a network of nine branch offices at the end of Q1FY25. 

The company differentiates itself by offering comprehensive logistics solutions supported by its extensive pan-India presence, integrated service offerings, emphasis on technological improvements, and large network of vehicles. It operates on an ‘asset-based’ business model where essential assets, such as commercial vehicles, containers, and warehouses, are either owned or leased from a network of business partners.

This approach allows the company to maintain a fleet of owned vehicles while supplementing it with leased vehicles as needed.

Over the years, the company has built enduring relationships with a diverse clientele. As of December 31, 2023, and for the financial years 2023, 2022, and 2021, the company and its subsidiaries served 517, 536, 508, and 446 customers, respectively, across various industries including automotive, paper, textile, and steel.

Notable customers include Ford India Private Limited, Piramal Glass Private Limited, TT Steel Services Private Limited, Atul Limited, and JK Paper Limited.

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