Delhivery Limited, the largest and fastest growing fully-integrated logistics player in the country, is all set to open its Dalal Street journey on Tuesday. Delhivery stock will be listed on both the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) at 10 am on May 24. Amid a volatile market, Delhivery initial public offering (IPO) saw a muted response from investors during the subscription period.
The logistics solution provider aimed to raise Rs 5,235 crore from its maiden offer. Delhivery IPO was open for subscription between May 11-13. The price band for Delhivery IPO was set at Rs 462-487 apiece.
Delhivery IPO was overall subscribed 1.63 times. The quota reserved for qualified institutional buyers (QIBs) was subscribed 2.66 times. The portion set aside for non-institutional investors (NIIs), retailers and eligible employees was subscribed 30 per cent, 57 per cent and 27 per cent, respectively.
The unlisted share of Delhivery was trading at a discount of Rs 5 in the grey market on Tuesday. The weak response from the investors and poor grey market premium indicate a muted listing of Delhivery IPO on May 24.
Delhivery Share Listing Today: What to Expect
“We are expecting another soft listing of the new IPO, we expect Delhivery to open near its offer price of Rs 462-Rs 487. We have given a neutral rating to Delhivery IPO on back of expensive valuations. If we look at valuation based on annualized FY22 numbers, the IPO is priced at EV/Sales of 4.8x and Price to Book value of 5.2x at the upper price band of the IPO. For 9MFY22 the company has reported an EBITDA loss of Rs 232 crores and Net loss of Rs 891 crores. If we look at the grey market premium, as per different market news GMP of Delhivery IPO is trading at Rs 5. So looking at expensive valuation and some correction in the market in the last two weeks we are expecting a soft listing of Delhivery IPO,” said Yash Gupta, equity research analyst, Angel One Ltd.
“Considering lower-than-expected subscription demands to its initial public offering (IPO) we expect marginally flat listing gain +or-5 per cent on a best case scenario considering the market’s volatility. We believe reason for low subscription was investors fear on business operation continued losses on books and followed by aggressive IPO valuations,” said Prashanth Tapse, vice president (Research), Mehta Equities Ltd.
Delhivery is the largest and fastest growing fully-integrated logistics player in India by revenues. It provides a full-range of logistics services, including express parcel and heavy goods delivery, part-truckload freight (PTL), truckload freight (TL), warehousing, supply chain solutions, cross border express and freight services and supply chain software, along with value added services, such as e-commerce return services, payment collection and processing, installation and assembly services and fraud detection.