Zinka Logistics gets Sebi nod for Rs 550-cr IPO; key details for investors

Through the IPO, Zinka Logistics is offering a fresh issue of shares of up to Rs 550 crore and an offer for sale of up to 21.61 million equity shares, with a face value of Re 1 apiece

Bengaluru-based Zinka Logistics Solutions has received final observation from the capital markets regulator, Securities and Exchange Board of India (Sebi), to raise funds through an initial public offering (IPO). Zinka Logistics had filed its IPO papers with Sebi on July 5, 2024.

Through the IPO, Zinka Logistics is offering a fresh issue of shares of up to Rs 550 crore and an offer for sale of up to 21.61 million equity shares, with a face value of Re 1 each, by promoters and investor selling shareholders. The IPO also includes a reservation for subscription by eligible employees, and a discount is being offered to eligible employees bidding in the employee reservation portion.

Zinka Logistics said that, in consultation with the book-running lead manager, it may consider a pre-IPO placement not exceeding 20 per cent of the size of the fresh issue. If such placement is completed, the fresh issue size will be reduced.

Zinka Logistics proposed that the proceeds from its fresh issuance, to the extent of Rs 200 crore, will be utilised for funding towards sales and marketing costs, Rs 140 crore for investment in Blackbuck Finserve for financing the augmentation of its capital base to meet its future capital requirements, and Rs 75 crore for funding of expenditure in relation to product development and general corporate purposes.

Zinka Logistics offers digital solutions to India's trucking industry. The company’s BlackBuck app serves as a comprehensive platform, providing solutions for payments, telematics, load management, and vehicle financing. Additionally, Zinka Logistics offers vehicle financing solutions, enabling truck operators to purchase used commercial vehicles or obtain financing on existing ones.

As per the Draft Red Herring Prospectus (DRHP), by March 31, 2024, Zinka Logistics had facilitated 4,035 loans amounting to Rs 196.79 crore. Revenue from this segment is derived from loan service fees and other charges related to loan disbursal and collections.

Zinka Logistics' consolidated revenue from continuing operations increased by 69.01 per cent to Rs 296.92 crore in fiscal year 2024 from Rs 175.68 crore in FY23, primarily due to an increase in its average monthly transacting truck operators, which led to an increase in its commission income, subscription fees, and service fees.