GB Logistics Commerce Limited, operating in the logistics and agricultural commodities trading sectors, is ready to launch its IPO. The company has established a strong foothold in the logistics industry, offering a wide range of freight services to large and medium-sized enterprises. Their key services include full truckload transportation, special handling, and delivery in out-of-area shipments, showcasing their diverse capabilities.

The IPO is a book-built issue raising ₹ 25.07 Crores, entirely through a fresh issue of 24.57 Lakh shares. The price band is set between ₹ 95 to ₹ 102 per share, with a market capitalization of ₹ 83.58 Crores at the upper price band. Retail investors can subscribe to a minimum lot size of 1,200 shares, requiring an investment of ₹ 1,22,400, while High-Net-Worth Individuals (HNIs) must subscribe to a minimum of 2,400 shares, amounting to ₹ 2,44,800.

The subscription period opens on January 24, 2025 and closes on January 28, 2025, with the allotment date scheduled for January 29, 2025. Investors can check the allotment status on the registrar's website once it goes live. The shares are set to list on the BSE SME platform on January 31, 2025.

GB Logistics Commerce IPO Financials and Performance

Looking at the financial performance, GB Logistics Commerce has shown consistent growth. For the period ended September 30, 2024, the company's revenue stood at ₹ 5,085.30 Lakh, while for the full fiscal year 2024, it was ₹ 11,563.31 Lakh. The company’s EBITDA for FY24 was ₹ 847.61 Lakh, and Profit After Tax (PAT) for FY24 reached ₹ 486.24 Lakh.

The company has demonstrated strong profitability, with a Pre-Issue EPS of ₹ 9.67 and a Post-Issue EPS of ₹ 5.93 for FY24. The P/E ratio at the upper price band is 10.55x pre-issue and 17.19x post-issue, significantly lower than the industry average of 79x, suggesting the IPO is fairly priced. Return on Capital Employed (ROCE) stands at 14.51%, and Return on Equity (ROE) is 27.36%.

IPO Subscription and Grey Market Premium (GMP)

As of January 19, 2025, the Grey Market Premium (GMP) for the GB Logistics Commerce IPO is ₹ 0, indicating no expected listing gains. This suggests that the demand in the grey market is neutral, and potential investors should focus on the company’s fundamentals rather than speculative market trends.

The IPO has also successfully raised ₹ 7.13 Crores from Anchor Investors, who have subscribed to 6,99,600 shares at ₹ 102 per share. This is a positive sign for the offering, but potential investors should proceed with caution given the lack of GMP excitement.

Objectives of the IPO

The funds raised from the GB Logistics Commerce IPO will be allocated toward:

1. ₹ 500.00 Lakhs for the prepayment of borrowings.
2. ₹ 937.77 Lakhs for working capital requirements.
3. ₹ 380.00 Lakhs for purchasing truck chassis and truck bodies.
4. Additional funds will be used for general corporate purposes.

Conclusion: Should You Invest in GB Logistics Commerce IPO?

Given the steady financial growth, moderate P/E ratio, and neutral GMP, the GB Logistics Commerce IPO presents a fairly priced investment opportunity. However, with the lack of significant listing gain expectations and neutral market sentiment, investors should consider this IPO for its long-term growth potential in the logistics sector, rather than for short-term listing gains.

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