Disappointing market debut of Landmark Cars IPO; shares drop 10% after listing

The shares of Landmark Cars made their market debut at a 7 per cent discount below their Initial Public Offering (IPO) price on Friday, 23 December. The listing of shares happened on National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) amid a negative domestic market. The company’s stock made its market debut on the BSE at Rs 471.3 against the public issue price of Rs 506. Shortly thereafter, the scrip dropped to Rs 446 per share, falling by 10 per cent. At the end of the trading session, the Landmark Cars shares were priced at Rs 460.05. Since the Landmark Cars shares were trading at a discount of Rs 15 in the grey market, a tepid listing was expected. The firm aimed to raise Rs 552 crore via the IPO, which contains a fresh issue of Rs 150 crore. The issue had an offer-for-sale (OFS) of Rs 402 crore by shareholders, including TPG Growth. The majority of the fresh issue proceeds will be used to repay debts and for general corporate purposes. As of June this year, the corporation had a debt of Rs 464 crore, a sharp rise from Rs 308 crore in March 2022. Pravesh Gour, Senior Technical Analyst of Swastika Investment, stated that while Landmark Cars debuted at a discount, a good response has been received from certain sectors, like institutional investors. He further said that the firm is increasing its presence in the after-sales segment. According to Gour, the company’s comprehensive business model captures the whole customer value chain and focuses on its overall business expansion with business leadership and experienced promoters. The public issue of the Landmark Cars was subscribed 3.06 times. Qualified Institutional Buyers (QIBs) showed much interest in the offer, bidding 8.71 times. The portion set aside for retail investors was subscribed only 59 per cent. The issue’s quota was oversubscribed by the Non-Institutional Investors (NIIs) by 1.32 times. The issue reserved for employees was bid upon 2.93 times. Landmarks Cars contains a huge network of car dealerships across India, including premium brands like Mercedes-Benz, Volkswagen, Jeep, and Renault. The firm also has a presence in the automotive retail value chain from sales, after-sales to authorised service centres. It has over 100 facilities across eight states in the country. Read all the Latest News , Trending News ,  Cricket News , Bollywood News , India News and Entertainment News here. Follow us on Facebook, Twitter and Instagram.