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Landmark Cars IPO Review: Landmark Cars Limited to enter Indian stock markets. Landmark Cars Limited’s IPO will open for subscription on December 13, 2022 and close on December 15, 2022. Rs. 552 crore to be raised. Out of which Rs. 150 crore will be fresh issue and remaining Rs. 402 crore will be the offer for sale. In this article, we will analyze Landmark Cars IPO Review 2022 and its strengths and weaknesses. Read on to find out!
Landmark Cars IPO Review – About the Company
Landmark Cars Limited, incorporated in 1998, is a leading premium automotive retailer in India with dealerships for Mercedes-Benz, Honda, Jeep, Volkswagen and Renault. In addition, the company also provides Ashok Leyland’s commercial vehicle retail business in India.
The company is the number one dealer of Mercedes-Benz, Honda and Stellantis (Jeep) in terms of sales volume in FY2021. Also, it was Renault’s third largest dealer in 2020.
The company also provides after sales services and has authorized service centers for Mercedes-Benz, Honda, Volkswagen, Jeep, Renault and Ashok Leyland.
The company offers the entire customer value chain, including retailing new vehicles, repairing vehicles, selling spare parts, lubricants and other products, selling pre-owned passenger vehicles and distributing third-party finance and insurance products.
It has a dealership network in 31 cities across eight states and union territories including Maharashtra, Uttar Pradesh, Gujarat, Haryana, Madhya Pradesh, Punjab, West Bengal and the national capital Delhi.
Competitors of the company
There are no listed companies in India whose business portfolio is comparable to that of the Company.
Landmark Cars IPO Review – Financial Highlights
(Source: Company’s DRHP)
Landmark Cars IPO Review – Industry Overview
The Indian passenger vehicle industry can be divided into three main segments namely mass market vehicles, premium vehicles and luxury vehicles.
Mass market vehicles dominated the Indian premium vehicle (PV) sector with over 60% market share in FY 2016, according to a CRISIL report. Over the past five years, the premium auto segment has grown at a healthy 8% CAGR, expanding its contribution from 38% in FY2016 to 56% in FY2021.
On the other hand, mass market vehicle sales shrank at a CAGR of 7%, with its market share falling from 62% in FY2016 to 44% in FY2021.
Mercedes-Benz has continued to dominate the luxury car market in recent years. In fiscal 2021, Mercedes Benz has a 44% market share in the Indian luxury vehicle segment, followed by BMW with a 36% market share, according to a CRISIL report. Ultra-luxury brands such as Ferrari, Rolls-Royce and Lamborghini are not a significant component of this overall market.
The premium automobile segment is expected to grow at a CAGR of 10-12% from FY2021 to FY2026, while the luxury segment is expected to grow at a CAGR of 20-22%, according to a CRISIL research report.
Strength
- It is a leading automotive supplier to major OEMs with a strong focus on high growth segments in India.
- The company is rapidly growing its after-sales business, which is set to increase its revenue and profit margins.
- The company has a comprehensive business model that captures the entire customer value chain.
- The company is technologically advanced, which enables them to reduce costs and increase efficiency, thus improving margins.
- The company is poised to enter the rapidly expanding electric vehicle (EV) market.
weaknesses
- The Company is subject to influence or restrictions imposed by OEMs based on dealership or agency agreements, which may affect their operations.
- The Company’s business is sensitive to factors such as inflation rates and currency exchange rates.
- The company operates in a competitive landscape. Thus, increasing participation of companies through online and offline marketing will affect their business.
- The company has been facing losses for the past two years.
- The automotive industry will undergo rapid changes in the next few years. .
Landmark Cars IPO Review – GMP
Shares of Landmark Cars Limited traded at a premium of 5.93% in the gray market on December 12, 2022. Shares Rs. Down to 536. This is a peak price per share of Rs. 506 rather than Rs. 30 as a premium.
Landmark Cars IPO Review – Key IPO Information
Advertisers: Sanjay Karshandas Thakkar
Top managers running the book: Axis Capital Limited and ICICI Securities Limited.
Registrant for Offer: LINK INTIME INDIA PVT.LTD
| details | details |
|---|---|
| IPO size | ₹552 crore |
| New issue | ₹150 crore |
| Offer for Sale (OFS) | ₹402 crore |
| Opening date | December 13, 2022 |
| last day | December 15, 2022 |
| face value | ₹5 per share |
| Price bar | ₹481 to ₹506 per share |
| A lot of size | 29 stocks |
| Minimum lot size | 1 (29 shares) |
| Maximum lot size | 13 (377 shares) |
| List date | December 23, 2022 |
Purpose of the problem
The net proceeds of the new issue are proposed to be used for:
- Repayment/advancement in whole or in part of certain loans received by the Company
- General corporate objectives
In conclusion
In this article, we have seen the details of Landmark Cars IPO Review 2022. Analysts are divided on the IPO and its potential gains. This is a good opportunity for investors to look at the company and analyze its strengths and weaknesses. That’s it for this post.
Are you applying for an IPO? Let us know in the comments below.
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