The initial public offering (IPO) of automobile dealership chain Landmark Cars would open for subscription on Tuesday (December 13). The three-day issue would conclude on December 15. The company has fixed a price band of Rs 481-506 per share for its Rs 552 crore initial share sale.
The public issue consists of a fresh issue of equity shares aggregating to Rs 150 crore and an offer-for-sale (OFS) of up to Rs 402 crore.
TPG Growth II SF PTE Ltd, Sanjay Karsandas Thakker HUF, Aastha Limited and Garima Misra are among those offloading shares through the OFS route.
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Landmark Cars said proceeds from its fresh issuance would be utilised for debt payment and general corporate purposes.
Half of the issue size has been reserved for qualified institutional investors, 35 per cent for the retail investors and the remaining 15 per cent for non-institutional investors.
The lot size of the IPO is 29 shares, for which one would have to spend Rs 14,674. A retail individual investor can submit bids for up to 13 lots or 377 shares by spending Rs 1,90,762.
“The company’s strategy is to broaden its after-sales service offering in order to serve more customers and increase its higher-margin service and repair revenues. Based on annualised FY23 earnings, the IPO is priced at a post-issue P/E of around 27 times,” Manan Doshi of UnlistedArena.com, dealing in unlisted & pre-IPO shares, told Business Today.
Grey market premium
Market participants said Landmark Cars IPO grey market premium (GMP) was at Rs 21. It implied that the grey market expected the company to list around Rs 527 (Rs 506 + Rs 21), a little over 4 per cent higher than the IPO’s upper band price of Rs 506 per equity share.
TPG-backed Landmark Cars is a leading premium automotive retail business in India with dealerships for Mercedes-Benz, Honda, Jeep, Volkswagen and Renault.
The company reported a loss of Rs 28.93 crore in fiscal 2020.
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Axis Capital and ICICI Securities are the book-running lead managers to the issue.