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21 December 2023

Committed Cargo Care IPO: Navigating Logistics, Securing Growth

Introduction:

Committed Cargo Care IPO emerges as a fixed-price issue, injecting vitality into the market with a corpus of Rs 24.98 crores. The entirety of this issue comprises a fresh offering of 32.44 lakh shares, symbolizing a strategic step towards expansion and financial fortification. The IPO bidding phase unfolded from October 6, 2023, to October 10, 2023, followed by the allotment finalization on Friday, October 13, 2023. The shares officially debuted on NSE SME on October 18, 2023.

Pricing and Lot Dynamics:

Priced at ₹77 per share, the IPO garnered significant attention. The minimum lot size for an application was set at 1600 shares, necessitating a minimum investment of ₹123,200. High Net Worth Individuals (HNIs) had the opportunity to invest in a minimum lot size of 2 lots (3,200 shares), equivalent to ₹246,400.

Market Performance Overview:

As of December 15, 2023, Committed Cargo Care Limited (COMMITTED) was valued at ₹56.25, reflecting a 3.21% increase. The stock displayed an opening figure of ₹55.20, with a high and low of ₹56.90 and ₹55.15, respectively. The previous closing stood at ₹54.50, with a total traded value of 17,600, offering insights into the recent market dynamics

Key IPO Highlights:

- IPO duration: October 6, 2023, to October 10, 2023
- Listing Date: October 18, 2023
- Face Value: ₹10 per share
- Issue Price: ₹77 per share
- Lot Size: 1600 Shares
- Total Issue Size: 3,244,000 shares, aggregating up to ₹24.98 Cr
- Fresh Issue: 3,244,000 shares, aggregating up to ₹24.98 Cr
- Issue Type: Fixed Price Issue IPO
- Listing At: SME, NSE

Equity Transition:

Pre-IPO, Committed Cargo Care had 7,569,600 shares in circulation. Post the IPO, this figure escalated to 10,809,600 shares, indicating a notable shift in market dynamics.

IPO Reservation Dynamics:

Strategically, the IPO allocated 3,240,000 shares, with 164,800 (5.09%) for Market Makers, 1,537,600 (47.46%) for Non-Institutional Investors (NIIs), and an equivalent 1,537,600 (47.46%) for Retail Individual Investors (RIIs).

IPO Timeline Snapshot:

- IPO Open Date: Friday, October 6, 2023
- IPO Close Date: Tuesday, October 10, 2023
- Basis of Allotment: Friday, October 13, 2023
- Initiation of Refunds: Monday, October 16, 2023
- Credit of Shares to Demat: Tuesday, October 17, 2023
- Listing Date: Wednesday, October 18, 2023
- Cut-off time for UPI mandate confirmation: 5 PM on October 10, 2023

Lot Size Landscape:

Investors were given the flexibility to bid for a minimum of 1600 shares and in multiples thereof. The table below outlines the investment parameters for retail investors and HNIs:

Application	Lots	Shares	Amount
Retail (Min)	1	1600	₹123,200
Retail (Max)	1	1600	₹123,200
HNI (Min)	2	3,200	₹246,400

Promoter Holdings Shift:

Promoters, namely Mr. Rajeev Sharma, Mr. Nitin Bharal, Mr. Narendra Singh Bisht, and Mr. Yashpal Arora, held 98.00% of shares pre-issue. Post the IPO, their stake transitioned to 68.63%.

Company Profile:

Incorporated in 1998, Committed Cargo Care Limited is a Third Party Logistics (3PL) provider specializing in handling Import and Export Cargo. The company offers a spectrum of integrated services, including cargo management solutions, order management, international freight management, customs and cross-border movement, and heavy and over-dimensional cargo movement. The clientele spans diverse sectors such as automotive, telecom, FMCG, e-commerce, pharma, and more.

Financial Performance Overview:

As of March 31, 2023, Committed Cargo Care reported robust financials:

- Assets: ₹4,015.13 Lakhs
- Revenue: ₹12,242.77 Lakhs
- Profit After Tax: ₹533.17 Lakhs
- Net Worth: ₹2,884.79 Lakhs
- Reserves and Surplus: ₹2,127.83 Lakhs
- Total Borrowing: ₹67.34 Lakhs

Key Financial Indicators:

- Market Cap: ₹83.23 Crores
- P/E (x): 10.94
- Post P/E (x): 12.84
- ROE: 18.48%
- ROCE: 24.06%
- EPS (Rs): 7.04
- RoNW: 18.48%

Objects of the Issue:

The Net Proceeds from the IPO are designated for:
1. Meeting working capital requirements. 2. General corporate purposes.

IPO Review:

Suggests that operating in a highly competitive segment, Committed Cargo Care marked inconsistency in its top line but displayed consistent growth in the bottom line. Given the bright prospects for this segment amid a growing economy, the issue appears fully priced based on FY24 annualized earnings. Investors are advised to consider parking funds for medium to long-term rewards.

IPO Subscription Status:

As of October 10, 2023, the Committed Cargo Care IPO witnessed exceptional subscription, reaching 87.78 times. The retail category subscribed 78.73 times, while the Non-Institutional Investors (NIIs) subscribed 94.20 times.

Note: All financial figures are in INR (Indian Rupees), and market-related data is as of December 15, 2023.

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