Landmark Cars IPO Worth ₹552 Crore Subscribed 22% On Its 2nd Day

TPG-backed Landmark Cars Ltd. is the country’s leading premium car dealer. The company launched its IPO on 13th December at a price band of ₹481-506.

On Day 2, the initial public offering (IPO), of Landmark Cars, an automobile dealership chain, was subscribed 22 percent. Total bids for the issue were 17,74,336 shares, compared to 80,41,805 shares. 

The employee quota was fully subscribed (1.53x), while the portion for retail investors (RIIs), was reserved at 24%, and the non-institutional investor (NIIs) received 46% subscription by Wednesday morning. The QIB (qualified institutional buyers) portion has not received any bids.

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The three-day issue will conclude on December 15. The price range for the initial share sale of Rs 552 crore is Rs 481-506 per share.

The public issue included a new issue of equity shares totalling to Rs 150 crore as well as an offer-for sale (OFS) up to Rs 402 million.

TPG Growth II SF PTE Ltd Sanjay Karsandas Thukker HUF and Aastha Limited would be among those who would offload shares via the OFS route.

Landmark Cars stated that proceeds from the new issuance will be used for debt repayment and general corporate purposes.

Qualified institutional investors have received half of the issue size, while retail investors will receive 35% and non-institutional investors 15%.

One would need to spend Rs 14,674 for 29 shares. Retail investors can bid for as many as 13 lots, or 377 shares, by spending Rs 1,90762.

“The company’s strategy was to expand its after-sales services offering to serve more customers, increase its higher-margin repair and service revenues, and to serve them better. 

The IPO price is based on FY23 annualized earnings. It will be priced at a post issue P/E of approximately 27 times.” 

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Manan Doshi, UnlistedArena.com who deals in unlisted & preIPO shares, explained to Business Today.

Arihant Capital stated that Landmark Cars is well-positioned in its target markets and faces little competition from larger players.

According to market participants, the Landmark Cars IPO gray market premium (GMP), was last heard at Rs 11 on Tuesday. 

It was up from Rs 8 and down from Rs 30, respectively. This implied that the gray markets expected Landmark Cars to have a decent listing.

TPG-backed Landmark Cars, a premium retail business for premium automobiles in India, has dealerships for Mercedes-Benz and Honda, Jeep, Volkswagen, Volkswagen, Renault, and other brands.

In fiscal 2020, the company suffered a loss of Rs 28.93 Crore. Axis Capital, ICICI Securities and ICICI Securities were the lead book managers for the issue.