What you must know about Popular Vehicles & Services IPO?

About Popular Vehicles & Services Ltd

Incorporated in 1983, Popular Vehicles and Services Limited operates within the automotive dealership sector in India. The company offers a comprehensive range of services spanning the entire vehicle ownership lifecycle including sales of both new and preowned vehicles, servicing, distribution of spare parts, driving schools and sales of financial and insurance products. Divided into three primary segments passenger vehicles including luxury vehicles, commercial vehicles, and electric two wheeler and three wheeler vehicles the company is headquartered in Kochi, India, with operational presence in Kerala and Tamil Nadu.

Popular Vehicles began its automobile dealership business in 1984, establishing its inaugural Maruti Suzuki showroom in Trivandrum, Kerala. Subsequently, it expanded its footprint, inaugurating Popular Motors' dealership in Chennai, Tamil Nadu, dedicated to Maruti Suzuki passenger vehicles in 2002. In 2015, the company ventured into spare parts distribution.

As of December 31, 2023, the company operated through 61 showrooms, 133 sales outlets, 32 preowned vehicle showrooms, 139 authorized service centers, 43 retail outlets, and 24 warehouses. These are spread across 14 districts in Kerala, 8 districts in Karnataka, 12 districts in Tamil Nadu, and 9 districts in Maharashtra.

Highlights of the Popular Vehicles & Services IPO

Here are some of the highlights of the Popular Vehicles & Services IPO

•    Popular Vehicles & Services will be open from March 12th, 2024 to March 14th, 2024.Popular Vehicles & Services has a face value of ₹2 per share and the price band for the IPO has been set in the range of ₹280 to ₹295 per share.

•    The IPO of Popular Vehicles & Services Ltd is a combination of fresh issue of 0.85 cr shares to ₹250.00 cr and offer for sale of 1.19 cr shares to ₹351.55 crores. 

•    The company has been promoted by John K. Paul, Francis K. Paul and Naveen Philip. The promoter holding in the company currently stands at 69.45%. However, post listing promoter equity holding will get diluted.

•    The funds raised will be used to repay or pre pay certain borrowings of the company and its subsidiaries. Additionally, the remaining amount will be allocated for general corporate purposes.

•    ICICI Securities Limited, Nuvama Wealth Management Limited, and Centrum Capital Limited serve as the book running lead managers for the Popular Vehicles & Services IPO, with Link Intime India Private acting as the registrar for the IPO.

Popular Vehicles & Services IPO Allocation

The net offer will be distributed among retail investors, Qualified Institutional Buyers (QIBs), and High Net Worth Individuals (HNIs) / Non-Institutional Investors (NIIs). The breakdown of the overall IPO of Popular Vehicles & Services Ltd in terms of the allocation to various categories are captured in the table below.

Popular Vehicles & Services IPO Lot sizes 

The lot size in an IPO is the minimum number of shares an investor must apply for. Once the IPO is listed, shares can be traded individually. In the Popular Vehicles & Services IPO, the minimum lot size is 50 shares, with an upper band indicative value of ₹14,750. The table below shows the minimum and maximum lot sizes for different investor categories.

Key dates for Popular Vehicles & Services IPO

The Popular Vehicles & Services IPO opens on Tuesday, March 12, 2024, and closes on Thursday, March 14, 2024. Similarly, the Popular Vehicles & Services Ltd IPO bidding period is from March 12, 2024, at 10:00 AM to March 14, 2024, at 5:00 PM. The cut-off time for UPI Mandate confirmation is also 5:00 PM on the closing day of the issue, which is March 14, 2024.

In ASBA applications, the total application amount is blocked, meaning it's temporarily set aside in your bank account. After allotment, only the allotted amount is debited, and the rest is automatically released back to your bank account. There's no refund process involved.

Financial highlights of Popular Vehicles & Services IPO

The table below captures the key financials of Popular Vehicles & Services Ltd for the last 3 completed financial years.

The company recorded growth in net profit at ₹64.07 Crore for the financial year ended March FY23, representing a 90.3% you increase. Revenue jumped to ₹4,892.63 Crore in FY23 from ₹3,484.20cr FY22. However, there was pressure on the operating margin, which fell to 4.45% from 4.6% in the previous year. Net profit for the six months ended September FY24 stood at ₹40 Crore on revenue of ₹2,835 Crore.

 Popular Vehicles & Services Strength

•    Extensive experience in the auto industry and strong partnerships with top manufacturers

•    Consistent history of making profits and growing steadily.

•    The company's comprehensive services and repairs contribute to higher revenue and enhance business stability.