May 29, 2024

Western Carriers (India) Limited files DRHP with SEBI

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Western Carriers (India) Limited, India’s largest private, multi-modal, rail focused, 4PL asset-light logistics company (in terms of container volumes in Fiscal 2022), has filed its draft red herring prospectus (DRHP) with capital markets regulator SEBI to raise funds through an initial public offering (IPO).

With Mr Rajendra Sethia, Chairman and Managing Director and Mr Kanishka Sethia, Chief Executive Officer and Whole-Time Director at the helm, Western Carriers operates on a scalable, asset-light business model which enables it to provide differentiated 3PL and 4PL solutions. Rajendra Sethia, company’s promoter first established his logistics business as a rail-focused logistics business in 1972, which was later acquired by Western Carriers in 2013. Western Carriers has over five decades of experience in road, rail and sea/river multi-modal movement for domestic as well as EXIM cargo in and out of India, through the combined experience of its promoter and the company.

As of December 31, 2022, Western Carriers had a customer base of over 1100 across varied sectors such as metals and mining, FMCG, pharmaceuticals, building materials, chemicals, oil and gas, utilities and others (which includes building material, textile, power, electrical equipment and retail). Some of its key clients are companies like Tata Steel, Hindalco Industries, Vedanta, BALCO, JSW, HUL, Coca Cola India, Tata Consumer Products, Cipla, Haldia Petrochemicals, MCPI, Gujarat Heavy Chemicals, BCPL, and DHL, among others.

According to the draft red herring prospectus, the IPO of the Kolkata-based logistics company comprises of a Fresh Issue of equity shares aggregating up to Rs. 500 crore and an Offer for Sale of up to 93,28,995 equity shares by Rajendra Sethia, the Promoter Selling Shareholder.

Western Carriers proposes to utilize the Net Proceeds from the Fresh Issue towards prepayment or scheduled re-payment of a portion of certain outstanding borrowings of Rs. 200 crore; funding of capital expenditure requirements of Rs. 186 crore towards purchase of (i) commercial vehicles; (ii) 40 feet specialised containers and 20 feet normal shipping containers; and (iii) reach stackers, and balance towards General Corporate Purposes.

The company, in consultation with the Book Running Lead Managers, may undertake a Pre-IPO placement, for cash consideration aggregating up to Rs. 100 crore prior to the filing of the RHP. If the Pre-IPO placement is completed, the fresh issue size will be reduced to the extent of such Pre-IPO placement.

As of Fiscal 2022, the company’s revenue from operations was Rs. 1470 crore, with a PAT of Rs. 61 crore.

Western has a pan-India presence through over 50 branch offices and four zonal offices across 23 states in India. The company’s warehouses are located across 10 states and it operates at over 55 major public rake handling points spread across India. Its pan-India presence allows it to provide both first-mile and last-mile connectivity to its customers who have operations across India, including in remote areas. In Fiscal 2022, Western Carriers (India) Limited operated the largest volumes of containers by an asset-light logistics player.

JM Financial Limited and Kotak Mahindra Capital Company Limited are the Book Running Lead Managers to the offer.

The equity shares are proposed to be listed on BSE and NSE.