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Shares of Zinka Logistics Solutions are going to be listed on the stock exchanges on November 21. Its early investors are confident of getting huge returns. They are expecting a huge profit of up to five times on their investment. This ₹1,115 crore IPO was open for subscription between 13 - 18 November, where it was subscribed 1.86 times. New shares worth ₹550 crore were issued in this issue.
Apart from this, the issue also included an offer-for-sale (OFS) of 2.06 crore shares, valued at ₹565 crore at the upper price band.
The price band of the IPO was between ₹259 - ₹273 per share. At the upper price band of ₹273, early investors can get a return of up to 5 times based on their acquisition cost shown in the company's red herring prospectus (RHP). Who will benefit Early investors in Zinka Logistics include Quickroutes International Private Limited, which invested in 2015 at an average acquisition cost of ₹52.04 per share. Its other investors include Excel India (₹62.71 in 2015), Sands Capital (₹132.09), Internet Fund Pte (₹69.07) and Peak XV (₹308.98 in 2018).
| How much profit did these investors get | |
| Quickroutes International | 5.24 times |
| Accel India | 4.35 times |
| Sands Capital | 2 times |
| Internet Fund Pte | 3.95 times |
However, lead PE investor, Peak XV Partners, may incur a loss on the acquisition cost of ₹308.98 per share, where the upper price band has been set at a much lower ₹273 per share. Earlier, the company had raised over ₹501 crore from anchor investors.
Where will the IPO funds be used?
An amount of ₹200 crore will be used for sales and marketing initiatives. ₹140 crore will be used to invest in BlackBuck Finserv to finance the capital base to meet future capital requirements. ₹75 crore will be used to finance product development-related expenditure and a portion will be used for general corporate purposes.
Zinka Logistics said it is "dedicated to transforming the trucking industry in India by digitally empowering truck operators to manage their businesses and increase their income".
What does Zinka Logistics do?
is a digital platform designed for truck operators. The company's BlackBuck app provides solutions for payments, telematics, load management and vehicle financing. The company provides better and safer tolling and fuel solutions by partnering with Fastag banks and several oil marketing companies (OMCs) and earns revenue through commission margins based on the transaction value.
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