TVS Supply Chain Solutions IPO subscribed 2.78 times on final day

The initial public offer (IPO) of TVS Supply Chain Solutions was subscribed 2.78 times on the final day of bidding as it received bids for 6.98 crore equity shares against an offer size of 2.51 crore shares. The quota reserved for QIBs was booked 1.35 times, while the non-institutional investors (NIIs) category subscribed 2.35 times. The portion for retail investors managed to garner a good response from investors as the quota reserved for them attracted 7.6 times bid, as per the BSE data.

The company, a part of TVS Mobility Group, had reserved up to 75% of the issue for QIBs, up to 15% for NIIs, and the remaining 10% for retail investors.

The three-day IPO of the Chennai-based transportation, logistics and warehousing company opened for subscription on August 10. The price band of the issue has been fixed from ₹187 to ₹197 per equity share. The shares will be allotted on August 18, while stocks are slated to list on the BSE and NSE on August 23. This will be the first public offer by the TVS Group entity in 25 years. 

The supply chain logistics solution provider’s IPO comprises an issue of fresh equity shares up to ₹600 crore and an offer for sale of 14,213,198 equity shares aggregating to around ₹880 crore (at the upper end of the price band). The company, in consultation with the BRLMs, undertook a pre-IPO placement of 8,486,970 equity shares aggregating ₹150 crore on July 27, 2023, to several investors including SBI Life Insurance.

A day before its IPO opened for subscription, TVS Supply Chain Solutions raised around ₹396 crore from 18 anchor investors. The anchor book was fully subscribed as the company allotted 2,01,01522 equity shares at ₹197 per share.

The Chennai-based company intends to use more than half of its IPO proceeds raised from the fresh equity shares to repay loans and invest in its overseas operations. It also plans to use a part of the fund for the purpose of strategic acquisitions.

Several brokerage houses have recommended a ‘subscribe’ to the offer with a long-term investment horizon. TVS Supply Chain Solutions (TVS SCS), a $1.2 billion organisation, is an India-based multinational company, which pioneered the development of the supply chain solutions market in India. The company claimed to be amongst India’s largest and fastest growing integrated supply chain solutions providers in terms of revenues in fiscal 2021. With a workforce of over 18,000 employees, the company has a presence in over 25 countries and works with 733 customers in India and 7,120 customers globally.  

As of September 30, 2022, TVS SCS has worked with 64 ‘Global Fortune 500 2021’ companies. As per the company, 75% of business comes from non-auto clients and 95% of business from non TVS group companies. TVS SCS has a long-term relationship with customers and the average period of relationship with the top 10 customers is 10—13 years.

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