The Deccan Transcon Leasing Limited IPO is generating strong interest from investors, offering shares at a price band of ₹102 to ₹108 per share. The IPO consists of a Fresh Issue of 55.24 lakh shares, aggregating to ₹59.65 crore, and an Offer for Sale (OFS) of 5 lakh shares, amounting to ₹5.4 crore. The total issue size is pegged at ₹65.05 crore. Investors can subscribe to the IPO from September 13 to September 18, 2024, with the allotment date expected around September 20, and the shares are likely to list on the NSE SME by September 23, 2024.

Deccan Transcon Leasing primarily operates in the logistics and shipping sector, offering comprehensive services including freight solutions, tank container leasing, and NVOCC services. Their end-to-end logistic solutions serve a variety of sectors, with specialized offerings like tank fleet management, custom clearance, and transportation services. The company’s ability to provide turnkey solutions across the supply chain positions it as a trusted partner in the industry.

Key Highlights of the Deccan Transcon Leasing IPO

The share price band has been set between ₹102 to ₹108 per share, with the minimum lot size being 1,200 shares. This translates into a minimum investment of ₹129,600 for retail investors, and ₹259,200 for High-Net-Worth Individuals (HNIs), who are required to invest in at least 2 lots (2,400 shares).

UNISTONE CAPITAL PRIVATE LIMITED is the book-running lead manager for the IPO, while LINK INTIME INDIA PRIVATE LIMITED serves as the registrar. Giriraj Stock Broking Private Limited acts as the sole Market Maker for the issue.

Grey Market Premium (GMP) and Subscription Status

As of the first day of the subscription period (September 13, 2024), the Deccan Transcon Leasing IPO was subscribed 3.61 times, showcasing significant demand among investors. The Grey Market Premium (GMP) for the issue is expected to range between ₹50 to ₹55, indicating positive listing expectations. However, investors should be cautious, as GMP figures are speculative and can fluctuate based on market demand and supply dynamics.

The live subscription status can be tracked on the NSE website throughout the subscription period, providing real-time updates on the demand for shares.

Anchor Investors and Institutional Interest

The IPO garnered ₹15.12 crore from anchor investors ahead of its official opening, with shares allocated at the upper end of the price band, ₹108 per share. A total of 1,400,400 equity shares were allocated to anchor investors, signaling robust institutional interest. This early investment from institutional buyers provides a positive signal to retail and HNI investors about the company's potential growth trajectory.

Financial Performance of Deccan Transcon Leasing Limited

Deccan Transcon Leasing has demonstrated steady financial growth over recent years. The company's revenue increased from ₹15,319.40 lakh in FY22 to ₹18,061.76 lakh in FY23, and currently stands at ₹15,363.76 lakh in FY24. The EBITDA surged from ₹881.44 lakh in FY22 to ₹1,901.65 lakh in FY24. Similarly, the company's profit after tax (PAT) increased from ₹519.10 lakh in FY22 to ₹1,181.89 lakh in FY24.

These strong financials are supported by a pre-issue EPS of ₹6.87 and a post-issue EPS of ₹5.20. The P/E ratio stands at 15.72x pre-issue and 20.76x post-issue, which is competitive compared to the industry P/E ratio of 23.33x. The company also boasts a Return on Capital Employed (ROCE) of 41.43% and a Return on Equity (ROE) of 45.03% in FY24, reflecting its efficient use of capital and strong profitability.

IPO Objectives and Growth Plans

The funds raised from the Fresh Issue of shares will be allocated as follows:

₹2,774.76 lakh for the procurement of tank containers to expand the company’s fleet.

₹1,150.00 lakh for working capital needs, enabling smoother operations and expansion.

The remaining funds will be used for general corporate purposes.

Deccan Transcon Leasing’s expansion plans, particularly the procurement of additional tank containers, will enhance its ability to meet rising demand in the logistics sector. The increased working capital will help the company scale its operations efficiently, positioning it for sustained growth in the coming years.

How to Check Deccan Transcon Leasing IPO Allotment Status

For investors eagerly waiting for the allotment of shares, the process to check allotment status is straightforward:

Visit the IPO allotment status page on the registrar's website.

Select Deccan Transcon Leasing Limited IPO from the list of active IPOs.

Enter your application number, PAN, or DP Client ID.

Submit the required details to view your allotment status.

The allotment date is expected to be September 20, 2024. Investors can use these steps to confirm whether they have received shares and prepare for the next steps, whether it's selling on the listing day or holding for potential long-term gains.

Conclusion and Investment Outlook

The Deccan Transcon Leasing Limited IPO offers a compelling opportunity for investors looking to gain exposure to the rapidly growing logistics and shipping sector. With strong financials, a clear growth strategy, and substantial demand reflected in the anchor investor participation and GMP trends, the IPO presents potential listing gains and long-term value.

Investors should consider their risk appetite and long-term investment goals before applying. While the company's solid track record and favorable market conditions support a positive outlook, the speculative nature of IPO investments should be carefully weighed.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Investors are encouraged to do their own research and consult with financial advisors before making any investment decisions. The market is dynamic, and investment outcomes can vary based on multiple factors. 

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