Pristine logistics IPO – Company Overview
Pristine logistics IPO – The company filed DRHP on May 12, 2022, and SEBI approved Pristine Logistics IPO. The company is coming up with an IPO of a fresh issue of INR 250 crores and up to 20,066,269 Equity Shares for an offer for sale (OFS). The face value of each equity share will be INR 5 per equity. Promoters and promoter groups are selling some part of their holdings in the company as OFS.
The company was incorporated as ‘‘Pristine Infraprojects Private Limited” in New Delhi, India on May 14, 2008. To become a public company before IPO, the name changed to “Pristine Logistics & Infraprojects Limited” on June 29, 2021, and a certificate of change of name was issued by the RoC. The registered and corporate office is in Commercial Plaza, Radisson Hotel Delhi, NH – 8, Mahipalpur, New Delhi, India.
- Pristine logistics is one of the leading multi-modal integrated logistics players in India.
- The company is active on the western and eastern coasts of India.
- Pristine logistics has 5 terminals – 4 in India and 1 in Nepal.
- The company operates five logistics parks in India through its Subsidiaries.
- Pristine operates over 300 road vehicles. The company owns ~9,05,000 square feet of warehousing area.
- The company also owns ~2,624 Domestic standard containers and 415 dwarf containers 40 feet containers for transportation of lightweight cargo.
Pristine Logistics & Infraprojects Limited Services
The company provides logistics infrastructure and services and pivoted around rail transportation networks. The company also provides logistics infrastructure and services across the spectrum, including non-container, container, rail transportation, and road transportation services.
Pristine Logistics & Infraprojects Limited solutions can be categorized as follows.
- Warehousing, storage, and cargo handling,
- Rail transportation
- Road transportation
- Third-party logistics (“3PL”) services
- Container handling
- Container maintenance and repair
Pristine logistics Owners and leadership team
The company is run by experienced Promoters and a qualified senior management team with significant experience in the business.
Mr. Amit Kumar is one of the promoters and a Whole-time Director of the Company. He holds a bachelor’s degree in arts (honors) from Kirorimal College, University of Delhi. Mr. Amit has over 28 years of experience in the government, railways, and logistics sectors, including over 12 years of experience as an entrepreneur. Before this assignment, he was associated with the Indian Railway Traffic Service (“IRTS) and CONCOR.
Mr. Durgesh Govil is one of the promoters of the company. He holds a bachelor’s degree in technology from the Indian Institute of Technology, Madras. Before this assignment, he worked with the South Eastern Railway, the Rail Vikas Nigam Limited. He has strong experience in setting up terminal infrastructure, in a cost-effective manner.
Mr. Rajnish Kumar is one of the promoters and a Whole-time Director of the Company. He holds a master’s degree in psychology from the University of Delhi. Mr. Rajnish has over 28 years of experience with Indian Railways, CONCOR. He has been a Director on our Board since October 28, 2009.
Mr. Sanjay Mawar is one of the promoters and a Whole-time Director of the Company. He holds a bachelor’s degree in arts (honors) from the University of Delhi. Mr. Sanjay has over 26 years of experience in different industries. He has been a Director on our Board since May 14, 2008.
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Pristine logistics Turnover
The total income of the company has been growing over the years. The company’s revenue from operation was INR 5,569.33 million in FY 2021 as against INR 4,692.74 million in FY 2020 which is about 18.6% growth. The company incurred a profit after tax of INR 48 million in FY 2021 as against a loss of INR 85 million.
Pristine logistics IPO – Valuation Parameters
The Net cash flow from operating activities has increased over the years mentioned. However, PAT and EBITDA as a percentage of revenue are not looking strong. The debt-to-equity ratio as of December 2021 was 0.66 which looks good. The company has total borrowings of INR 2,463.94 million. Considering, the company will utilize net proceeds from the IPO of INR 1750 million to reduce its debt, the debt will be negligible or zero debt company after the IPO process. Refer to the table below for more financial details.
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Pristine logistics IPO – Financial Details
| All amounts in INR Million except percentages (Year ended March 31) | 2019 | 2020 | 2021 |
|---|---|---|---|
| Revenue from Operations | 3,650.77 | 4,692.74 | 5,569.33 |
| Total Income | 3,772.86 | 4,743.55 | 5,632.72 |
| Profit After Tax for the Year | 114.03 | – 85.01 | 48.26 |
| EBITDA | 440.18 | 475.58 | 1,022.00 |
| EBITDA (%) of Revenue from Operations | 12.06 | 13.13 | 18.35 |
| Net Debt / Equity | 0.6 | ||
| Earnings Per Share-Diluted (in INR) | 2.03 | -1.65 | 1.62 |
| Net Cash from Operating Activities | -117.51 | 226.07 | 915.23 |
Pristine logistics IPO: Do you invest? 10 factors to know
- The government of India launched the national logistic policy in 2022, aiming to reduce the logistic cost to below 10% of GDP from the current 14%.
- There are a lot of opportunities in the logistics sector to capture the market share, considering the Indian GDP growth rate of 7% per annum.
- Pristine logistics will also benefit from other government policies such as Dedicated freight corridors, and the Gati Shakti scheme.
- The company has been looking for inorganic growth through acquisitions. Particularly acquiring distressed assets and turning them into a profitable business.
- Pristine logistics is planning to acquire Sical logistics – currently undergoing a corporate insolvency resolution process. This accusation will open its gateway to south Indian states.
- The company operates by experienced promoters. All the promoters have prior experience working with major logistic players and long-standing industry relationships with key stakeholders.
- The company is aiming to provide end-to-end services that include rail transportation, terminal services, and first-mile and last-mile road services across the country.
- Net proceeds from fresh issues will be used for repayment or pre-payment borrowings availed by its Subsidiaries and other general purposes.
- However, the financial performance of the company is lackluster with low EPS and lower PAT.
- I will wait for further financial information before investing in the company. I would avoid this IPO.
- There are other strong peers available in the market to invest in. Refer to “Top 6 logistics stocks” in India.
- Companies such as CONCOR Corp, Aegis Logistics, and Allcargo logistics are better-listed players in this segment.