TVS Supply Chain Solutions Ltd. IPO - Review, Valuation, Date & GMP

TVS Supply Chain Solutions Limited - Complete Overview

TVS Supply Chain Solutions Limited stands as India's largest and one of the fastest expanding integrated providers of supply chain solutions among the listed Indian companies in this sector, both in terms of revenue and revenue growth.

Being a multinational corporation rooted in India, it holds the distinction of pioneering the advancement of the supply chain solutions market within the nation, according to the Redseer Report.

For over 16 years, the company has been delivering its specialized, technology-driven supply chain management services to global enterprises, government entities, as well as large and medium-sized businesses across a diverse range of industries.

The company's service offerings are categorized into two main segments:
1. Integrated Supply Chain Solutions (ISCS): This covers an array of services including sourcing and procurement, comprehensive transportation solutions, logistics operation centres, in-plant logistics operations, finished goods management, aftermarket fulfilment, and supply chain consulting.
2. Network Solutions (NS): Encompassing Global Forwarding Solutions (GFS) which manage end-to-end freight forwarding and distribution through various modes such as ocean, air, and land, along with warehousing, port storage, value-added services, and Time

Critical Final Mile Solutions (TCFMS) which entail enclosed loop logistics and support services like spares logistics, break-fix, refurbishment, engineering assistance, and courier and consignment management.

Notably, TVS has provided its services to 11,546, 10,531, and 8,788 clients during the fiscal years 2021, 2022, and 2023 respectively. In India, it catered to 1,120, 1,044, and 902 customers during the same period.

TVS's clientele spans a wide spectrum of industries including automotive, industrial, consumer goods, technology and tech infrastructure, rail and utilities, as well as healthcare.

Some of the esteemed clients of TVS are Sony India Private Limited, Hyundai Motor India Limited, Johnson Controls-Hitachi Air Conditioning India Limited, Ashok Leyland Limited, TVS Motor Company Limited, Diebold Nixdorf, TVS Srichakra Limited, Lexmark International Technology Sarl, VARTA Microbattery Pte Ltd, Daimler India Commercial Vehicles Private Limited, Hero MotoCorp Limited, Modicare Limited, Panasonic Life Solutions India Private Limited, Dennis Eagle Limited, Electricity North West Limited, Yamaha Motor India Private Limited, and Torrot Electric Europa, S.A.

 

 

What does the company do?

TVS Supply Chain Solutions Limited offers technology-driven supply chain management services to global enterprises, government entities, as well as large and medium-sized businesses across a diverse range of industries.

 

IPO Overview

The IPO date of TVS Supply Chain Solutions is scheduled from August 10 to August 14, 2023. The IPO will be listed on both the NSE and the BSE, with a face value of Rs.1.

The company plans to allocate the IPO shares as follows: 75% to institutional investors, 15% to non-institutional investors, and only a 10% portion will be available for retail investors.

This upcoming IPO involves a fresh issue of Rs.600.00 Crores. The shares are expected to be listed on the market on August 23, 2023. As of now, the TVS Supply Chain Solutions share price has not been disclosed.

 

TVS Supply Chain Solutions Limited IPO timetable

EVENTS	DATE
IPO Opening Date	10 August 2023
IPO Closing Date	14 August 2023
IPO Allotment Date	18 August 2023
Refund initiation	21 August 2023
IPO Listing Date	23 August 2023

 

TVS Supply Chain Solutions Limited IPO Details

IPO Opening & Closing Date	10 August to 14 August 2023
Face Value	Rs. 1 per share
Issue Price	--
Lot Size	--
Price of 1 Lot	--
Issue Size	--
Offer for Sale	14,213,198 shares of Rs.1 (aggregating up to Rs.[.] Cr)
Fresh Issue	14,213,198 shares of Rs.1 (aggregating up to Rs.[.] Cr)
Listing at	BSE, NSE
Issue Type	Book Built Issue IPO
Registrar	Link Intime India Pvt. Ltd.

 

TVS Supply Chain Solutions Limited IPO Lot Details

Minimum Lot Investment (Retail)	1 Lot
Maximum Lot Investment (Retail)	13 Lot
Minimum Lot Investment (HNI)	14 Lot
Maximum Lot Investment (HNI)	67 Lot

 

TVS Supply Chain Solutions Limited IPO Reservation

Institution Portion	75%
Non-Institution Portion	15%
Retail Portion	10%

 

Company Financial

Amount in Crores

Period	FY 21	FY 22	FY 23
Total Assets	4990.06	5789.73	6210.92
Total Revenue	6999.69	9299.94	10311.01
PAT	-76.34	-45.80	41.76
Net Worth	490.69	714.00	723.55
Reserve & Surplus	473.94	713.76	774.19
Total Borrowings	1547.92	1763.78	1989.62

 

Revenue Contribution by Top Customers

Amount in Million

Revenue by Customers	FY 21	FY 22	FY 23
Top 5 Customers	13,397.47	15,267.10	18,331.86
Top 10 Customers	18,975.01	22,892.25	28,343.88
Top 20 Customers	25,704.87	32,761.37	39,798.50

 

Details of the various costs incurred by the TVS Supply Chain Solutions Limited

Amount in Million

Particular	FY 21	FY 22	FY 23
Freight, clearing, forwarding and handling charges	20,870.78	34,794.27	37,328.71
Employee benefits expense	18,050.31	18,891.32	20,930.04
Sub-contracting costs	8,019.24	10,636.47	10,705.10
Casual labour charges	2,412.13	3,017.40	4,174.94

 

External revenue from each of the operating segments under Ind AS 108

Amount in Million

Segment	FY 21	FY 22	FY 23
ISCS (A)	32,041.17	37,407.12	45,806.26
NS (B)	37,294.81	55,090.74	56,547.54
Total (C=A+B)	69,335.98	92,497.86	102,353.80

 

Revenue from operations from customers engaged in the various industries of TVS Supply Chain Solutions Limited

Amount in Million

Revenue from customers engaged in various industries	FY 21	FY 22	FY 23
Industrial	18,617.00	29,880.19	36,182.77
Automotive	16,729.99	20,275.75	23,714.37
Tech and Tech Infra	12,099.16	13,215.27	12,272.56
Consumer	8,589.21	11,662.90	12,014.37
Rail and Utilities	5,513.33	5,935.67	5,906.13
Healthcare	1,461.43	2,102.48	1,743.95
Others	6,325.85	9,425.60	10,519.64
Total	69,335.98	92,497.86	102,353.80

 

Revenue from Operations by Geography

Amount in Million

Geography	FY 21	FY 22	FY 23
India (A)	16,731.88	24,368.37	30,267.14
Rest of the World
United Kingdom	24,473.63	29,296.78	30,367.12
Europe (ex UK)	9,940.57	14,759.70	13,687.84
Australia and New Zealand	6,150.99	9,825.54	8,794.22
North America	5,049.77	4,066.91	7,315.98
Others	6,989.15	10,180.56	11,921.51
Rest of the World (B)	52,604.10	68,129.49	72,086.66
Total (C=A+B)	69,335.98	92,497.86	102,353.80

 

Objective of the Issue

The company will utilize the funds to achieve the following objectives:

• Prepayment or repayment of all or a portion of certain outstanding borrowings obtained by the Company and its Subsidiary, TVS LI UK and TVS SCS Singapore.
• General corporate purposes.

 

Promoters and Management of TVS Supply Chain Solutions Limited

The primary promoter of the company is Ramachandhran Dinesh, aged 57, who holds the position of Promoter and serves as the Executive Vice Chairman. In addition to him, the company's corporate promoters consist of TVS Mobility Private Limited, T.S. Rajam Rubbers Private Limited, and Dhinrama Mobility Solution Private Limited.

Pre-issue Promoters Holding	46.65%
Post-issue Promoters Holding	--

 

Peer Comparison

As per the TVS Supply Chain Solutions DRHP, the following entities are peer competitors to the company.

Company Name	P/ E as of July 25, 2023	Revenue from operations (in Rs. million)	Restated earnings / (loss) per share (Rs.) for continuin g and discontinu ed operations - Diluted (Rs.)	Closing Share Price as on July 25, 2023 (Rs. per equity share)
TVS Supply Chain Solutions Limited	-	102,353.80	1.02	-
TCI Express Limited	40.57	12,410.10	36.20	1,468.80
Mahindra Logistics Limited	42.15	44,589.00	8.94	376.85
Blue Dart Express Limited	46.38	51,722.20	154.43	7,161.75
Delhivery Limited	-	18,596.27	(2.14)	413.55

 

IPO's Valuations

The IPO valuation of TVS Supply Chain Solution cannot be determined as the company has not specified the issue price and P/E ratio of the share.

 

Dividend Policy

The company has not paid any dividends in the past, and there is no assurance or declaration in the DRHP about potential future dividend payments.

 

IPO's Strengths 

• Strong presence in the rapidly expanding and fragmented third-party logistics market in India.
• Leading position in providing comprehensive solutions backed by domain expertise, global network, and knowledge base.
• Notable competitive advantage through robust in-house technology differentiation.
• Proven track record of successful integration of acquisitions to enhance capabilities and acquire new customers.
• Established long-term customer relationships in diverse and appealing industries.
• Resilient business model with multiple drivers of profitable growth.
• Strong parentage with the management team with diverse industry experience

 

IPO Weaknesses

• Incurred losses in FY 2021 and 2022.
• Indebtedness and restrictions from financing agreements could lead to negative consequences, including suspension of drawdowns.
• Exposed to risks due to fluctuations in foreign currency exchange rates.
• Issued Equity Shares below the Offer Price in the past twelve months.
• Proceeds from the Offer for Sale won't go to the company, but to the Selling Shareholders.
• Global operations are subject to local laws; non-compliance could lead to adverse legal proceedings.
• Significant portion of operating expenses are freight, handling charges, and manpower; any increase may harm financial condition.
• Asset-light model heavily relies on network partners and third parties for warehousing and transportation, potentially impacting the business.
• Operating in a fiercely competitive and fragmented industry.
• No long-term agreements with key customers.
• Need to adhere to applicable laws and regulations.
• Some Material Subsidiaries have incurred losses and might continue to do so.

 

 

IPO GMP Today

As on 14th August, 2023The GMP of TVS Supply Chain Solutions Limited is Rs.3.

 

Conclusion

The company operates within a highly competitive sector and has faced losses in previous fiscal years. Observing the grey market performance could provide clearer insights into potential listing gains for the shares. Seasoned investors may consider investing in the company following thorough analysis.

 

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To Read the Prospectus of the Company Click Here to Download the RHP and Click Here to Download the DRHP

 

 

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