Goldman Sachs-Backed Zinka Logistics Sets Price Band For Rs 1,115 Crore IPO

Zinka Logistics Solutions Ltd., the company behind digital logistics services provider BlackBuck, has set the price band for its upcoming initial public offering in the range of Rs 259 to Rs 273 per share. At the upper end of the price band, the company is looking to raise Rs 1,114.7 crore from the book-building issue.

Bids can be made for a minimum lot of 54 shares or in multiples thereof. Zinka Logistics has reserved 26,000 shares for eligible employees and will offer them at a discount of Rs 25 apiece.

The company, which counts Goldman Sachs, Accel and Flipkart among its investors, will launch the public offer with a fresh issue worth Rs 550 crore and an offer for sale of around 2.07 crore shares, according to the announcement.

Under the OFS portion, promoters Rajesh Kumar Naidu Yabaji, Chanakya Hridaya and Ramasubramanian Balasubramaniam will offload around 44.38 lakh shares. Other shareholders selling stake in the IPO include Accel India IV (Mauritius) Ltd., Peak XV Partners Investments VI, Internet Fund III Pte., and International Finance Corporation.

Since the company incurred a loss in the last financial year, the basis and diluted earnings per share are negative, and thus, the price-to-earnings ratio is not ascertainable, the company said.

Zinka Logistics offers payments, telematics, loads marketplace and vehicle financing services to truck operators. Founded in April 2015, the company logged 9.63 lakh customers transacting on the BlackBuck app, as per the draft red herring prospectus for the IPO.

• Zinka Logistics and its subsidiary TZF Logistics incurred losses and witnessed negative cash flows in the past three financial years. Subsidiary BlackBuck Finserve Pvt. saw negative operating cash flows during this period.

• Payments and telematics offerings make up for 94.53% of the total revenue from continuing operations in the last fiscal, showing higher dependency on these verticals.

• The company derives most of its revenue from commission income and subscription fees.

• Founded only in 2015, the company has limited experience in vehicle financing business.