Zinka Logistics Solution shares make muted debut, list at ₹280.90, up 2.89% from IPO price

Zinka Logistics Solution IPO listing:  Zinka Logistics Solution (BlackBuck) shares made a muted debut on the bourses on Friday, November 22. It listed at ₹280.90 on NSE, a premium of 2.89 percent over the issue price of ₹273. Meanwhile, on BSE, it listed at ₹279.05, up 2.22 percent from IPO price.

Zinka's initial public offering (IPO), valued at ₹1,114.72 crore, was open for subscription from November 13 to November 18. The digital platform for truck operations, which owns the BlackBuck App, has fixed the Zinka Logistics Solution IPO price band at ₹259 to ₹273 per equity share.

Following the three days of bidding, Zinka IPO closed with robust demand, garnering 1.87 times bids. The IPO received bids for 4.19 crore shares against 2.24 crore shares on offer. The retail investor segment was booked 1.70 times, while the non-institutional investors (NII) category wasn't fully subscribed and was bid 0.24 times. The qualified institutional buyers (QIB) portion was subscribed at 2.72 times. Finally, the employee quota was booked the most 9.86 times.

About the IPO

Zinka IPO was a combination of fresh issue of 2.01 crore shares aggregating to ₹550.00 crore and offer for sale of 2.07 crore shares aggregating to ₹564.72 crore. Post the issue, promoter shareholding in the company will be reduced to 27.84 percent from 32.91 percent before the IPO. The company raised ₹501.33 crore from anchor investors on November 12, 2024. Retail investors could apply with a minimum lot size of 54 shares, requiring a minimum investment of ₹14,742.

The company plans to use the net proceeds from the offering to support various objectives, including covering sales and marketing expenses, investing in its NBFC subsidiary, Blackbuck Finserve Private Limited, to strengthen its capital base for future needs, funding product development initiatives, and addressing general corporate expenses.

Zinka IPO includes a reservation of up to 26,000 shares for employees offered at a discount of ₹25 to the issue price. Of the net offer, 30 percent is reserved for qualified institutional bidders (QIBs). Non-institutional investors (NIIs) and retail investors will have allocations of 15 percent and 10 percent of the net offer, respectively.

Axis Capital Limited, Morgan Stanley India Company Pvt Ltd, Jm Financial Limited and Iifl Securities Ltd are the book running lead managers of the BlackBuck IPO, while Kfin Technologies Limited is the registrar for the issue.

"The company is one of the leading digital platform for the truck owners providing them all related services under one roof. The company posted losses till FY24, and has turned the corner from Q1-FY25. Based on FY25 annualized earnings, the issue appears aggressively priced. Well-informed/cash surplus/risk seekers may park moderate funds for long term," said Dilip Davda of Chittorgarh.com with a may apply rating.

About the Company

Zinka Logistics Solution Limited, founded in April 2015, operates the BlackBuck app, a digital platform designed for truck operators in India. In FY24, the platform facilitated business for 963,345 truck operators, accounting for 27.52% of the nation's total truck operators. The app provides services such as payments, telematics, a freight marketplace, and vehicle financing, enabling operators to streamline their operations efficiently. As of March 31, 2024, the company recorded a Gross Transaction Value (GTV) of ₹173,961.93 million in payments, managed an average of 356,050 active telematics devices monthly, and facilitated 4,035 loans worth ₹1,967.88 million.

Zinka's financial performance also witnessed significant growth, with revenue rising by 62.24% and profit after tax (PAT) increasing by 33.24% year-over-year.