Premier Road Lines Ltd IPO: Review, Valuation, Date & GMP

Premier Road lines Limited IPO - Complete Overview

Premier Road lines Limited was founded by Late Shri Nand Ram Gupta ji four decades ago in Delhi. In the last two decades, his son, now the Chairman, Virender Gupta, has taken PRL to great heights with his vision in the transportation industry.

The PRL Limited Company is an IBA-approved company. With a turnover of more than 200 crores. Our rich logistics legacy of nearly 40 years has enabled us to transport all sorts of dry cargo across the length and breadth of the country with advanced technical know-how. To ensure that the customer is always satisfied, each consignment is handled with the highest degree of professionalism.

Providing all logistics services across India for multinationals, small and medium companies, and a variety of sectors, Premier Road lines Limited offers services to multinationals, SMBs, and a variety of sectors.

 Besides standard transport and project logistics, the company also handles oversized and overweight cargo as a general freight agency. Through its end-to-end services, the company collects goods directly from customers and enables them to be delivered to their specified locations throughout India.

Under its Contract Logistics division, Premier Road lines primarily serves B2B clients, providing bulk transportation of goods within India and neighbouring countries like Nepal and Bhutan. Over 26,000 orders were completed across India in fiscal year 2022-23. In order to provide transportation services, the company collaborates with third parties, such as small fleet owners and agents. In addition to container trucks, trailers, hydraulic axles, and more, these partners supply the company with essential transportation equipment.

Founded in Delhi, the company operates 28 branches across cities such as Ahmedabad, Bengaluru, Chennai, Guwahati, Hyderabad, Kolkata, Mumbai, Nashik, Pune, and more. 204 full-time employees, including senior executives, were employed by the company as of 31 December 2023.

Registered Office-B-870, Near Church, New Ashok Nagar, New Delhi – 110096, Delhi, India.

Corporate Office-501, 5th Floor, Plot No. 4B, Tower A, Nextra, Mayur Vihar, Phase-I Extension, East Delhi–110091, Delhi, India.  

Contact Person-Gaurav Chakravarti, Company Secretary & Compliance Officer

E-mail: cs@prlindia.com

Tel No: +91-11- 4401 5000

Website: www.prlindia.com

 

Premier Road lines IPO Overview

The Premier Road lines IPO is a book-built issue for Rs 40.36 crore. It is a fresh issue of 60.24 lakh shares.

The subscription period for the Premier Road lines initial public offering will open on May 10, 2024, and close on May 14, 2024. It is expected that the allotment for the Premier Road lines IPO will be finalized on Wednesday, May 15, 2024. The tentative listing date for Premier Road lines IPO is Friday, May 17, 2024, on NSE SME.

Shares of Premier Road lines are priced between 63 and 67 dollars. A minimum lot size of 2000 shares is required for an application. Retail investors must invest at least $134,000. For HNIs, there is a minimum investment of two lots (4,000 shares) amounting to $268,000.

The bookrunning lead manager for the Premier Road lines IPO is Hem Securities Limited, while the registrar is Maashitla Securities Private Limited.

 

Company Financial

In the financial year ending March 31, 2022, Premier Roadlines Limited's revenues increased by 38.48%, and profits after taxes (PAT) increased by 84.89%.

Period Ended	30 Sep 2023	31 Mar 2023	31 Mar 2022
Assets	7,444.46	7,410.76	5,144.62
Revenue	9,639.60	19,205.60	13,868.81
Profit After Tax	440.80	718.50	388.60
Net Worth	3,143.97	2,703.17	1,984.67
Reserves and Surplus	2,990.89	2,550.09	1,831.59
Total Borrowing	3,509.01	3,677.26	2,354.82

 

Key Performance Indicator

Key Financial Performance	For the period and financial year ended on
	September 30, 2023*	March 31, 2023	March 31, 2022
Revenue from Operations(1)	9,636.99	19,192.65	13,862.12
EBITDA(2)	817.55	1,280.18	755.93
EBITDA Margin(3)	8.48%	6.67%	5.45%
Profit After Tax (PAT) (4)	440.80	718.50	388.60
PAT Margin(5)	4.57%	3.74%	2.80%
ROE(6)	15.08%	30.65%	21.70%
ROCE(7)	11.74%	19.37%	16.73%

*Not Annualized

Notes:

• Revenue from Operations means the Revenue from Operations as appearing in the Restated Financial Statements.
• EBITDA is calculated as Profit before tax + Depreciation + Interest Cost – Other Income
• ‘EBITDA Margin’ is calculated as EBITDA divided by Revenue from Operations
• PAT is calculated as Profit before tax – Tax Expenses
• PAT Margin’ is calculated as PAT for the period/year divided by revenue from operations.
• Return on Equity is ratio of Profit after Tax and Shareholder Equity
• Return on Capital Employed is calculated as EBIT divided by capital employed, which is defined as shareholders’ equity plus total borrowings {current & non-current}.

The Objective of the Issue

In order to achieve the following objectives, the proceeds of the Issue will be used by the company:

The company repays or prepays certain borrowed funds in full or in part.

• Commercial vehicle purchase.
• Providing working capital; and
• For general corporate purposes.

 

Peers of Premier Road lines Limited IPO

• VRL Logistics Limited
• AVG Logistics Limited
• Ritco Logistics Limited

 

Evaluation: Premier Road lines Valuations & Margins

Period	FY 2021	FY 2022	FY 2023
EPS	0.92	2.31	4.27
PE ratio	–	–	14.75 – 15.69
RONW (%)	9.74	19.58	26.58
NAV	9.48	11.79	16.05
ROCE (%)	10.43	16.73	19.37
EBITDA (%)	4.52	5.45	6.67
Debt/Equity	1.49	1.19	1.36

 

IPO's Strengths

• Relationships with customers and logistics partners are of utmost importance to Premier Road lines Limited. As part of its operational efficiency and service excellence, the company prioritizes open communication, trust, and reliability.
  
  
• It is the Company's priority to enhance its brand image and to ensure that its quality standards are consistently met. With this commitment, Premier Road lines Limited demonstrates customer confidence, strengthens its market positioning, and distinguishes itself as a reputable and reliable logistics solution provider.
  
  
• The network of Premier Road lines Limited is robust and growing across the country. The company strengthens its competitive edge in the logistics sector by expanding strategically and optimizing logistical operations.
  
  

IPO's Weaknesses

• In order to conduct logistics operations, Premier Road lines Limited heavily relies on third parties, such as small fleet owners and agents. The company's ability to deliver services and meet customer demands could be at risk if there are any disruptions or issues with these external partners.
  
  
• The Company's information technology systems are susceptible to disruptions or failures, including cyber risks. It is possible for these incidents to disrupt operations, compromise data security, and compromise business continuity, posing a risk to the company's reputation and financial stability.
  
  
• Premier Road lines Limited relies heavily on the road network and uninterrupted vehicle usage. Whenever there is a disruption or limitation of road infrastructure, such as an accident, roadblock, or regulatory change, the company's logistics operations may be hampered, leading to delays, higher costs, and possibly lost customers.

IPO GMP Today

The Latest GMP of Premier Road lines Limited is Rs.20.

 

Premier Roadlines IPO Details

IPO Date	May 10, 2024 to May 14, 2024
Listing Date	[.]
Face Value	₹10 per share
Price Band	₹63 to ₹67 per share
Lot Size	2000 Shares
Total Issue Size	6,024,000 shares (aggregating up to ₹40.36 Cr)
Fresh Issue	6,024,000 shares (aggregating up to ₹40.36 Cr)
Issue Type	Book Built Issue IPO
Listing At	NSE SME
Share holding pre issue	22,862,547
Share holding post issue	28,886,547
Market Maker portion	304,000 shares

 

Premier Road lines IPO Timeline (Tentative Schedule)

Premier Road lines IPO opens on May 10, 2024, and closes on May 14, 2024.

IPO Open Date	Friday, May 10, 2024
IPO Close Date	Tuesday, May 14, 2024
Basis of Allotment	Wednesday, May 15, 2024
Initiation of Refunds	Thursday, May 16, 2024
Credit of Shares to Demat	Thursday, May 16, 2024
Listing Date	Friday, May 17, 2024
Cut-off time for UPI mandate confirmation	5 PM on May 14, 2024

 

Premier Road lines IPO Reservation

Investor Category	Shares Offered
QIB Shares Offered	Not more than 50.00% of the Net offer
Retail Shares Offered	Not less than 35.00% of the Offer
NII (HNI) Shares Offered	Not less than 15.00% of the Offer

 

 

Premier Road lines IPO Lot Size

Investors can bid for a minimum of 2000 shares and in multiples thereof. The below table depicts the minimum and maximum investment by retail investors and HNI in terms of shares and amount.

Application	Lots	Shares	Amount
Retail (Min)	1	2000	₹134,000
Retail (Max)	1	2000	₹134,000
HNI (Min)	2	4,000	₹268,000

 

Premier Road lines IPO Promoter Holding

Virender Gupta, Rakhi Gupta & Samin Gupta are the company's promoters.

Share Holding Pre Issue	100.00%
Share Holding Post Issue

 

Promoters and Management of Premier Road lines Limited IPO

• Virender Gupta: The Promoter and Chairman & Managing Director of the company is Virender Gupta. He has served on the Board of Directors of the Company since its incorporation. From the University of Delhi, he holds a bachelor's degree in commerce. With over 30 years of experience in Logistics & Transportation, he has a wealth of knowledge.
  
  
• Rakhi Gupta is the Promoter and Whole-Time Director of the company. Since incorporation, she has served on the Company's Board of Directors. She holds a bachelor's degree in arts from the University of Delhi. She has 15 years of experience in the logistics industry. As part of our company, she is responsible for general business and administration functions.
  
  
• Mr. Samin Gupta is the Promoter, Whole Time Director, and Chief Financial Officer of the company. He has served on the Board of Directors of the Company since 2022. The University of Warwick awarded him a Master of Science in Supply Chain and Logistics Management in 2022 after he completed a bachelor’s in business administration in Finance and Accounting at Christ University in 2021.
  
  
• Naveen Bansal serves as a Non-Executive Director of the company. As a member of the Institute of Chartered Accountants of India, he has earned the designation of Chartered Accountant. He has more than 7 years of post-qualification experience in various fields, including Statutory Audit, Direct and Direct Taxation, Financial & Statutory Reporting, GST Compliance. Currently, he is a partner in a practicing CA firm.
  
  
• Sunil Gupta is an independent director. His qualification is from the Institute of Chartered Accountants of India. His post-qualification work experience includes Direct & Indirect Taxation-Compliances, Management Consultancy & Business Automation Financial Planning, Tax & Internal Audits, Accounting. A practicing CA firm currently employs him as a partner. In 2020, he joined our company.
  
  
• Megha Aggarwal serves as an independent director. Indira Gandhi National Open University awarded her a bachelor's degree in commerce. As a Fellow Member of the Institute of Company Secretaries of India, she is an Insolvency Professional. Besides Corporate Law, Securities Law, Corporate Governance, Compliance, Legal Advisory Services, Restructuring, Insolvency, FEMA regulations and CSR, she has 12 years of post-qualification work experience in various fields. In 2023, she joined our company.

        

Premier Road lines Limited IPO Lead Managers

 

• Premier Road lines SME IPO Registrar-
  Maashitla Securities Private Limited

         Address: 451, Krishna Apra Business Square

• Netaji Subhash Place

         Pitampura, Delhi, 110034

         Website: https://maashitla.com/allotment-status/public-issues

         Phone: +91-11-45121795-96

         Email: ipo@maashitla.com

 

Premier Road lines SME IPO Lead Manager

Hem Securities Limited

Address: Premier Road lines SME IPO Important dates - Issue Open Date, close Date, SME IPO Listing Date. SME IPO Details - Offer Size, Issue Size, Type o

Dividend Policy

There is no formal dividend policy for equity shares at company prospectus. Their Board of Directors will recommend, and the shareholders of our Company will approve the declaration and payment of dividends at their discretion. Several factors will influence our Board of Directors' decision, including our results of operations, earnings, capital requirements and surplus, general financial conditions, Indian legal restrictions, and other factors that may be relevant.

Conclusion

The road transportation industry is dominated by several companies competing for market share. Road line companies can suffer from price wars, margin pressure, and reduced profitability due to intense competition. Road line companies may also face competition from new technologies and alternative modes of transportation (such as rail, air, and sea). You are advised to invest in this upcoming IPO after thorough analysis and consultation from the expert.

 

 

Finowings IPO Analysis

Hope you enjoyed the Finowings IPO Analysis. We tried our best to give every required detail about the company that you should know before applying to the IPO. 

You must consult your financial advisor before making any financial decisions. 

To Apply for the IPO, Click Here.

 

To Read the Prospectus of the Company Click Here to Download the DRHP.

 

 

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