Landmark Cars Limited IPO

Apply 0
Avoid 0

i. Landmark Cars is a leading premium automotive retail business in India with dealerships for Mercedes-Benz, Honda, Jeep, Volkswagen and Renault.

ii.  Landmark Cars also have a commercial vehicle dealership with Ashok Leyland in India. They have a presence across the automotive retail value chain, including sales of new vehicles, after-sales service, and repairs (including sales of spare parts, lubricants, and accessories), sales of pre-owned passenger vehicles, and facilitation of the sales of third-party finance and insurance products. Landmark Cars started its operations and opened its first dealership for Honda in CY1998, and they have expanded its network to include 112 outlets in 8 Indian states and union territories, comprised of 59 sales showrooms and outlets and 53 after-sales service and spares outlets, as of June 30, 2022.

iii. In the three months ended June 30, 2022 and in Fiscal 2022, the company sold 5,398* and 19,264* new vehicles, respectively, including new passenger vehicles of Mercedes-Benz, Honda, Volkswagen, Jeep and Renault and new commercial vehicles of Ashok Leyland.

Competitive Strengths

i. Leading automotive dealership for major OEMs with a strong focus on high growth segments
ii. Growing presence in after-sales segment leading predictable growth in revenues and superior margins
iii. Comprehensive business model capturing entire customer value-chain

Objects of the Landmark Cars Limited IPO:

The Company proposes to utilize the Net Proceeds from the Fresh Issue towards funding the following objects: 1. Repayment/pre-payment, in full or in part, of certain borrowings availed by the Company and Subsidiaries. 2. General corporate purposes.

Landmark Cars Limited IPO Details:

Open Date: Dec 13 2022
Close Date: Dec 15 2022
Total Shares: 10,909,091
Face Value: ₹ 5 Per Equity Share
Issue Type: Book Built Issue
Issue Size: 552 Cr.
Lot Size: 29 Shares
Issue Price: ₹ 481-506 Per Equity Share
Listing At: NSE,BSE
Listing Date: Dec 23 2022

Promoters And Management:

Sanjay Karsandas Thakker is the Chairman and Executive Director of the Company. He has a bachelor’s degree in commerce from Sydenham College of Commerce and Economics, University of Bombay. He founded the Group Landmark in 1998. He has more than two decades of experience in the automobile industry. He was awarded with the title of ‘Business Leader of the Year’ at the 19th global edition and 4th Indian edition of the Business Leader of the Year Awards presented by World Leadership Congress and Awards on February 17, 2021. Aryaman Sanjay Thakker is an Executive Director of the Company. He has a bachelor’s degree in business administration from the Bharati Vidyapeeth Deemed University, Pune and has a master’s degree of science in marketing and strategy from the University of Warwick. He joined Group Landmark in 2017 as a General Manager of LAPL. Prior to joining the Landmark Group, Aryaman was associated with AutoNation Corp in Fort Lauderdale, Florida, United States. Paras Somani is an Executive Whole-Time Director of the Company. He has a bachelor’s degree in commerce from the Saurashtra University and has also participated in the ISBCEO Leadership Programme by the Indian School of Business, Hyderabad from July 2017 to August 2018. He joined Group Landmark in 2006 as the Vice President- Sales in LAPL and currently leads the Mercedes-Benz and Volkswagen business in Group Landmark. He has over two decades of experience in sales and banking. He was previously associated with Kotak Mahindra Primus Limited.

Financials of Landmark Cars Limited IPO:

Particulars (In Crores) 2022 2021 2020
Revenue From Operations 2977 1956 2219
Purchase of stock in trade 2553 1710 1781
Change in inventories -41 -63 114
Employee Benefits Expense 153 108 137
Other expenses 137 91 114
EBITDA 175 110 73
OPM% 5.88% 5.62% 3.29%
Other Income 13 10 10
Finance Cost 35 38 45
Depreciation 70 62 63
PBT 83 20 -25
Tax 16 9 4
PAT 67 11 -29
No. of Shares 3.95 3.95 3.95
EPS 17.0 2.8 -7.3
 

Comparison With Peers:

There are no listed companies in India that engage in a business similar to that of the Company.

Recommendation on Landmark Cars Limited IPO:

Review and Recommendation of Landmark Car IPO by IZ Team is 4/10

1.  They are a leading premium automotive retail business in India with dealerships for Mercedes-Benz, Honda, Jeep, Volkswagen and Renault and also commercial vehicle retail business of Ashok Leyland. 2. They have a presence across the automotive retail value chain, including sales of new vehicles, after-sales service and repairs (including sales of spare parts, lubricants and accessories), sales of pre-owned passenger vehicles and facilitation of the sales of third-party financial and insurance products.  The Car sales business is having low EBITDA of 2-3% while the after sales service business has higher EBITDA margins of 17-18%. 3. As on 30.09.2021, they have a network which include 112 outlets in 8 Indian states, comprised of 61 sales showrooms and outlets and 51 after-sales service and spares outlet. The vehicle dealership network is spread across 31 cities in eight states and union territories including Maharashtra, Uttar Pradesh, Gujarat, Haryana, Madhya Pradesh, Punjab, West Bengal and the National Capital Territory of Delhi. 4. As per CRISIL, the premium car market is expected to increase with CAGR of 10-12% in next 5 years and Luxury segment is expected to increase with CAGR of 20-22% in next 5 years. 5. The biggest risk in the business is the slowdown in the sales of premium and luxury cars and pricing set by OEMs for after sales and repair services. 6. Revenue is continuously decreasing from ~2800 Crores in FY19 to ~2000 Crores in Fy21. 7. Company was in losses in Fy19 and Fy20. And, made a Profit of 11 Crores in Fy21. 8. D/E is slightly more than 1. 9. P/E on the basis of 6MFy21 results is 36x which looks on higher side. 

Lead Manager of Landmark Cars Limited IPO:

  1. Axis Capital Limited
  2. ICICI Securities Limited

Registrar of Landmark Cars Limited IPO:

  1. Link Intime India Private Limited

Company Address:

Landmark Cars Limited Landmark House, Opp. AEC, S.G. Highway, Thaltej, Near Gurudwara, Ahmedabad 380 059, Phone: +91 79 6618 5555 Email: companysecretary@landmarkindia.net Websitehttps://www.grouplandmark.in/

Discussion on Landmark Cars Limited IPO:

2 Comments

Leave a Reply