TVS Supply Chain Solutions makes muted debut on stock markets 

TVS Supply Chain Solutions listing: TVS Supply Chain Solutions had an underwhelming stock market debut on August 23, opening at a 5 per cent premium to its issue price of Rs 197. The stock began trading at Rs 206.30 on the BSE and Rs 207.05 on the NSE. Before its listing, the company was experiencing a grey market premium (GMP) of Rs 5 per share.

IPO subscription

The logistics firm's IPO, which amounted to Rs 880 crore, saw a subscription rate of 2.78 times from August 10 to 14. The bids received were for 6.99 crore equity shares, exceeding the IPO size of 2.51 crore shares. Retail investors played a significant role, subscribing to 7.61 times the allocated quota.

TVS Supply Chain Solutions originally started as part of the TVS group, operating under the name TVS Logistics, before becoming an independent entity in 2004. Today, the company, known as TVS SCS, offers comprehensive solutions to Fortune 500 companies globally. Its business is divided into two primary segments - integrated supply chain solutions and network solutions. With a presence in 26 countries across Europe, Asia (including India), and Australia, the company has achieved revenue growth of 21.5 per cent CAGR from FY21 to FY23, reaching Rs 10,235 crore in FY23.

Financial performance 

The company had a profit of Rs 41.8 crore in FY23, a significant improvement from losses of Rs 45.8 crore in FY22 and Rs 76.34 crore in FY21. The profit after tax (PAT) margin for FY23 was 0.41 per cent, compared to -0.5 per cent in FY22 and -1.1 per cent in FY21. 

TVS Supply Chain Solutions holds a price-to-earnings (PE) ratio of 209.43x based on FY23 figures. While this is more expensive than peers like TCI Express (40.57x) and Bluedart Express (46.38x), the company's larger scale justifies its higher valuation. However, compared to Mahindra Logistics, which boasts a P/E ratio of 875x, TVS SCS appears relatively cheaper.

As of 10:16 am, the stock was trading 3.24 per cent higher at Rs 200.35 on the NSE.