Zinka Logistics Solution, known for its popular BlackBuck platform for truck operations, recently launched its Initial Public Offering (IPO) in India. The IPO opened for public bidding on November 13, 2024, and will stay open until November 18, 2024. The company plans to generate approximately ₹1,114.72 crore through its IPO, offering shares within a price range of ₹259 to ₹273 each.
This IPO combines newly issued shares with an Offer for Sale (OFS) from current shareholders. The capital raised is expected to help Zinka Logistics expand its digital freight marketplace and strengthen its leadership in the Indian logistics industry.
Subscription Status So Far
On the second day of bidding, the IPO has gained some attention from retail investors but received a more limited response from institutional and non-institutional buyers. Here’s how the subscription numbers stand as of the second day:
- Overall Subscription: 28%
- Retail Individual Investors (RIIs): 0.71 times
- Qualified Institutional Buyers (QIBs): 0.26 times
- Non-Institutional Investors (NIIs): 0.03 times
Retail investors, who are generally individual buyers, have shown the most interest in the IPO. The high level of interest from this group reflects their confidence in Zinka Logistics’ potential for growth. However, larger institutional investors, such as Qualified Institutional Buyers (QIBs), have so far been more cautious, showing lower demand for the IPO shares.
In the grey market, where shares of companies planning IPOs are bought and sold unofficially, the Grey Market Premium (GMP) for Zinka Logistics Solution has seen a significant shift. The GMP, which was initially at ₹25 on the first day of bidding, has now fallen to zero. This means that grey market sentiment has cooled, with Zinka’s shares now trading at par with the IPO’s upper price band of ₹273.
A zero GMP indicates that there is no premium over the IPO price in the grey market. This shift suggests that investors are concerned about recent stock market volatility, which may affect the potential listing gains for Zinka Logistics shares.
The Zinka Logistics Solution IPO has captured the interest of retail investors but received a mixed response overall. Retail investors have shown a higher demand, indicating confidence in the company’s growth story. However, institutional investors and grey market traders have taken a more cautious approach due to the high valuation and current market volatility.
For those considering investing, it’s essential to weigh the company’s strong growth prospects against the high price and uncertain market conditions. Zinka Logistics has a robust business model and is part of an industry with a bright future. Yet, market challenges and valuation concerns make this a decision to approach with careful thought.
while the Zinka Logistics IPO has potential, investors are advised to take market conditions and valuations into account before making a final decision.
