Bids can be made for a minimum lot of 22 equity shares and in multiples of 22 equity shares thereafter
Kishore Biyani's third-party logistics (3PL) firm Future Supply Chain Solutions Ltd (FSCSL) is set to raise Rs 650 crore through an initial public offer (IPO) thus paving way for a part exit for its private equity (PE) investor Griffin Partners. The PE firm had picked up 40% equity in the 3PL firm for around Rs 580 crore back in April 2016.
Speaking to DNA Money, Mayur Toshniwal, managing director and chief executive officer, FSCSL, said, "Of the 25% odd offer for sale, approximately 20% is being offered by the private equity from (Griffin Partners) and the balance 5% is by the company promoters i.e. Future Enterprise Ltd (FEL)."
While investment firm Griffin Partners will offload up to 7,827,656 equity shares constituting around 20% of its holding in FSCSL, the company promoters will sell up to 1,956,914 equity shares or roughly 5% in the company. Post the successful completion of this public issue, Griffin Partners' holding in the company will come down to around 15% while stake held by company promoters will come down to 52.4% odd.
Interestingly, just last week, Edelweiss managed entities viz. Edelweiss Crossover Opportunities Fund and EW Clover Scheme had acquired 4.9% stake from PE firm SSG Capital Management that owns Griffin Partners, FEL had earlier said in a stock exchange filing.
A subsidiary of FEL, 3PL has filed a draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (Sebi) to issue up to 9,784,570 equity shares at a price band of between Rs 660 and Rs 664 per equity share.
The offer would constitute 24.43 % of the post-offer paid-up equity share capital of the company. The issue will open on December 6 and close on December 9, 2017. Bids can be made for a minimum lot of 22 equity shares and in multiples of 22 equity shares thereafter.
Among India's largest organised third-party logistics service operators, FSCSL reported revenue of Rs 561.2 crore for fiscal 2017. The company has registered compounded annual growth rate of 17.3% between the fiscal 2015 and 2017. While operating profit (ebitda) grew 7.8% profit after tax (PAT) increased 36.2% in the same period.
For fiscal 2018 the company's revenue from operations until September 2017 stood at Rs 357.4 crore while operating profit (ebitda) and PAT stood at 15.7% and 9.3%, respectively.
FSCSL currently offers automated and IT-enabled warehousing, distribution and other logistics solutions to a wide range of customers. According to Toshniwal, its service offerings, warehousing infrastructure, pan-India distribution network, 'hub-and-spoke' transportation model and automated technology systems support its competitive market position.
"We cater to various sectors across India, including retail, fashion and apparel, automotive and engineering, food and beverage, fast moving consumer goods (FMCG), e-commerce, healthcare, electronics and technology, home and furniture and ATMs," he said.
As of September 30, 2017, the company ran contract logistics operations through 42 distribution centres across India, covering approximately 3.84 million square feet of warehouse space and operated two distribution centres of customers, covering approximately 0.37 million square feet of warehouse space.
Further, during September 2017, it operated approximately 687 containerised vehicles, including 257 GPS-enabled vehicles of which 144 are refrigerated (reefer) trucks that are owned by the company. It also operates 9,616 pallets as a part of its temperature-controlled logistics services.
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