Tarachand Logistics Solutions Limited IPO
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Industry Overview
(a) Logistic Sector
The Indian logistics sector is primarily categorized into four segments comprising Transportation (rail, road, air, waterways), warehousing (Container freight stations and Inland Container Depots), freight forwarding and value-added logistics. The transportation contributes maximum (60%) to the whole pie of logistic sector which comprises of various means such as road, rail, air, and water.
The matter of the fact is around 64.5% of Transportation is being done through Roads [Company’s Foray].
(b)GST Implementation
Post GST logistic cost will reduce to 10-12% of total value of goods as compared to 14% of total value of goods pre GST. So the implementation of GST is favoring this sector.
(c) Govt. Initiatives
In November 2017, logistics sector was given the status of infrastructure, to boost investments in the sector.
Budget allocation for road sector increased to US$ 10.07 billion in 2017-18 from US$ 8.99 billion in 2016-17.
Road projects worth Rs 6.92 trillion (US$ 107.64 billion) approved in October 2017.
The Government is making an attempt to revive and give a boost to Public-Private Partnerships.
Objects of the Tarachand Logistics Solutions Limited IPO:
Repayment of Certain Secured Borrowings availed by our Company.
Purchase of Capital Equipment.
To meet working capital requirement
General Corporate purposes
Issue Expenses
Tarachand Logistics Solutions Limited IPO Details:
| Open Date: | Mar 13 2018 |
| Close Date: | Mar 15 2018 |
| Total Shares: | 3720000 |
| Face Value: | ₹ 10 Per Equity Share |
| Issue Type: | Fixed Price Issue |
| Issue Size: | 20.46 Cr. |
| Lot Size: | 2000 Shares |
| Issue Price: | ₹ 55 Per Equity Share |
| Listing At: | NSE Emerge |
| Listing Date: | Mar 26 2018 |
Promoters And Management:
Vinay Kumar, MD 55 Hold Bachelor Degree in Arts from Guru Nanak Dev, University Amritsar. He is also the promoter of the company and associated with since inception of the company for the last 30 years.
Ajay Kumar, Whole time Director 53 Matriculate by qualification. He is also the promoter of the company and associated with since inception of the company for the last 30 years.
Himanshu Aggarwal, ED 31 He holds a Bachelor degree of science in Biomedical Engineering from Northwestern University, Chicago, USA. He is currently the CFO of the company.
Prerna Sandeep Agarwal, Non ED 32 She holds a Bachelor’s Degree in Science from Mumbai University. She has been associated with the Company since August 20, 2014.
Niranjan Kumar Roy, Independent Director 51 He is a B. Tech from IIT(BHU), Varanasi. He has been associated with the Company since August 20, 2014.
Chaman Lal Lakhanpal, Independent Director 77 He holds a Bachelors degree in law from Punjab University. He is a retired Indian Administrative Service (IAS) Officer
Company Business:
The company was incorporated as Tara Chand Logistic Solutions Limited on February 10, 2012, under the provision of Companies Act, 1956 in Registrar of Companies, Punjab, and Chandigarh for the purpose of acquiring the proprietary business of M/s. Tara Chand & Sons, which was in existence since 1989. The Company is engaged in providing reliable and affordable Logistic and Supply chain services including Transportation and Warehousing, Equipment Rental and Steel Processing[ Started Recently in 2016] and Distribution.
Sr.no Verticals Revenue(% of last 9 months ending Dec 2017)
Major Clientele( Company has an impressive list )
1.Reliance industries ltd 2.Larsen & Toubro Ltd. (seven Independent Companies) 3. Steel Authority of India Ltd. 4.Rashtriya Ispat Nigam Ltd. 5.Oil and Natural Gas Corporation Ltd. 6.Tata Projects Ltd. 7.Hindustan Construction Company Ltd. 8.Vedanta Ltd. 9.J Kumar Infraprojects Ltd. 10. NCC Ltd. 11.Welspun Corp 12. ITD Cementation India Ltd. 13.Bharat Heavy Electricals Ltd. 14.Gayatri Projects Ltd 15.Megha Engineering & Infrastructures Ltd.
Some Major-Key Events, Awards, Recognitions, Accreditations and Mile Stones
2013- Acquisition of ongoing business of M/s Tara Chand & Sons vide Agreement of Takeover dated April 01, 2012.
2013- Executed Erection works of 4 Stations of Bangalore Metro Rail Corporation at Bangalore with Ahluwalia Contracts India Ltd
2013- Bagged prestigious order towards establishment & operation of TMT Steel Rebar Processing Plant at IIT Hyderabad Project for Larsen & Toubro
2014- Awarded Seven Year Contract as Handling Agent for Rashtriya Ispat Nigam Limited at Kalamboli, Navi Mumbai.
2015- Awarded the Best Maintained Stockyard for Kalamboli Stockyard by Rashtriya Ispat Nigam Limited.
2015 -Awarded four and half year contract from Steel Authority of India Ltd. for handling Iron & Steel Materials.
2018 -Awarded prestigious contract of Segment Transportation Works for Mumbai Metro Line 3 by HCC Ltd and Jkumar Infraprojects Ltd.
2018- Bagged a Seven Year Contract as Consignment Agent for Handling & Storage of Iron and Steel Materials for Rashtriya Ispat Nigam Ltd at Faridabad, Haryana.
| Sr.no | Verticals | Revenue(% of last 9 months ending Dec 2017) |
| 1 | Logistics | 65% |
| 2 | Equipment Rental | 14.43% |
| 3 | Steel Processing | 20.56% |
Capital Structure:
| Authorized Share Capital (1,50,00,000 Equity Shares @FV=10) | 15 Cr |
| Issued, Subscribed,& Paid-up Share Capital Before Issue ( 99,24,980 Equity Shares@ FV=10) | 9.92498 Cr |
| Present Issue (37,20,000 Equity Shares@FV=10) | 3.72 Cr |
| Reservation for Market Maker (1,92,000 Equity Shares @FV=10) | .192 cr |
| Net Issue to Public (37,20,000-1,92,000)= 35,28,000 | 3.528 cr |
| Retail Quota(<2 Lkah) | 50% of 35,28,000 |
| HNI & QIB Quota(>2 Lakh) | 50% of 35,28,000 |
| Paid Up Capital after the issue | 13.64498 |
Financials of Tarachand Logistics Solutions Limited IPO:
Balance Sheet Snippet[ All Calculations are for FY-16-17]
• The company has total Shareholders’ Fund[Equity] value=1504.75 Lakh
• The total Asset of the Company=6626.81 Lakh
• The Total Liability(debt)= 5122.06 lakh
• Debt/Equity=3.4( High).
• RONW(PAT/Networth)=17.47%
Profit n Loss Snippet[ All Calculations are upto Mar 17]
• Revenue of last 5 years is growing at approx. CAGR of 23.57%[ Good Growth].
• Profit After Tax of last 5 years is growing at approx. CAGR of whopping 47.23%[ Excellent].
• EPS( PAT/no. of Outstanding Shares)= 3.5571( after the issue)
• PE= 15.40(reasonably priced).
Cash Flow Statement
• The company is generating a positive cash flow from last 5 years[ Very Good sign).
Recommendation on Tarachand Logistics Solutions Limited IPO:
Recommended for long term and as well as for good listing gain.
Lead Manager of Tarachand Logistics Solutions Limited IPO:
Registrar of Tarachand Logistics Solutions Limited IPO:
Company Address:
Site 6, Sector 10E, Kharghar-Taloja Link Road,
Roadpali, Kalamboli, Navi Mumbai-410218
Phone: +91- 22-65821111/65812222
Email: info@tarachandindia.in
Website: www.tarachandindia.in
Bid Details of Tarachand Logistics Solutions Limited IPO as on
15-Mar-2018 15:55:01 IST
| Category | No.of shares offered | No. of shares bid |
|---|---|---|
| 1,764,000 | 4,344,000 | |
| 1,764,000 | 4,884,000 | |
| 192,000 | 192,000 | |
| 3,720,000 | 9,420,000 |
| QIBs | Yes |
| QIBs+HNIs Subscription | 2.46X |
| Retail Subscription | 2.77X |
| Total Subscription | 2.62X |
Discussion on Tarachand Logistics Solutions Limited IPO:
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