Paradeep Parivahan Ltd, founded in 2000 under the leadership of Mr. Khalid Khan, has steadily established itself as a key player in cargo handling, port operations, intra-port transportation, and related services. The company's portfolio also extends to railway siding operations, hazardous cargo handling, and other logistics functions critical to the smooth functioning of ports.

The Paradeep Parivahan IPO is a book-built issue, aiming to raise ₹ 44.86 crores, with a price band set between ₹ 93 to ₹ 98 per share. The total offering consists of a fresh issue of 45.78 lakh shares. The subscription period for the IPO opened on March 17, 2025, and will close on March 19, 2025, with the allotment expected on March 21, 2025 and shares to be listed on the BSE SME on or around March 24, 2025. The lot size for the IPO is 1,200 shares, and retail investors must invest a minimum of ₹ 1,17,600.

The Grey Market Premium (GMP) for Paradeep Parivahan IPO is expected to be ₹ 0, indicating no potential listing gains. This suggests a cautious outlook for the IPO, based on the company's financial performance and market conditions.

Key Subscription Details and Expectations

As of March 18, 2025, the live subscription status shows the IPO subscribed 0.13 times on its second day. While the Grey Market Premium remains flat at ₹ 0, indicating no significant interest from traders, it is important to follow updates on the allotment status to determine your participation.

The Anchor Investors Report indicates a ₹ 11.70 crores raise at the upper price band of ₹ 98, allocating 11.94 lakh equity shares to these investors. This allocation suggests institutional interest in the company, though the broader market sentiment may not be as robust.

Financial Performance and Valuation

The company's revenue from operations for the fiscal year 2024 stands at ₹ 13,794.19 lakh, with a profit after tax of ₹ 517.61 lakh. The pre-issue EPS for FY24 is ₹ 14.15, and the post-issue EPS is expected to be ₹ 9.44. The pre-issue P/E ratio stands at 6.93x, while the post-issue P/E ratio rises to 10.38x, compared to the industry average of 25x. These metrics suggest that the IPO is reasonably priced in relation to the industry.

Objectives of the IPO

The primary objectives of raising funds through this IPO are to meet working capital requirements (₹ 3,500.00 Lakhs) and for general corporate purposes. This indicates the company's focus on strengthening its operational base and expanding its capabilities in the logistics and transportation sectors.

Risks and Recommendations

While Paradeep Parivahan Ltd has shown steady growth in recent years, with strong financial metrics such as a ROCE of 26.61% and a ROE of 33.62%, the company faces risks related to its reliance on a few key clients and third-party suppliers. The company's financial performance suggests a potential for steady growth, but the no Grey Market Premium and flat GMP are concerns for investors looking for immediate listing gains.

Given these factors, the Paradeep Parivahan IPO is fairly priced but may not offer immediate listing gains based on current market trends. Investors seeking listing gains should be cautious, while those interested in long-term growth might consider evaluating the company's future potential.

Conclusion

While Paradeep Parivahan’s IPO offers a fair valuation, with robust financial metrics and a strong presence in the logistics sector, the lack of Grey Market Premium and flat GMP suggests a cautious approach for those interested in quick listing profits. Investors should monitor the subscription status closely and review their options based on their investment strategy.

The Upcoming IPOs in this week and coming weeks are Arisinfra Solutions Limited, Grand Continental Hotels, Rapid Fleet Management Services.

The Current active IPO are Paradeep Parivahan, Divine Hira Jewellers.

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