Future Supply Chain Solutions: Brokerage Views & Run up to IPO

This post on Future Supply Chain Solutions Limited IPO tries to bring out consolidated brokerage views opinions, IPO Review / Analysis, Note/ reports and recommendation of brokerages , Analyst, Business New papers, Management views, information on Anchor investors, Subscription etc on Future Supply Chain Solutions Limited IPO and shall be updated continuously till the closure of the issue. The information collated from various sources and reports in public domain can help investors to decide whether they should subscribe to Future Supply Chain Solutions Limited IPO or not.

Related Posts: Future Supply Chain Solutions Limited IPO Review: Good Prospects

Subscription: Future Supply Chain Solutions Limited IPO  ( x times)
  QIB NII Retail Total
Day 3  12.36  11.15  3.28 7.56
Day 2  0 .63  0.66  0.83 0.74
Day 1 0.5 0.18 0.27 0.32
Future Supply Chain Solutions Limited IPO: Grey Market Premium etc.

05/12/17 Grey Market Premium Rs. 15-20 (Few Deals) 

Complete Anchor List

Anchor Investors (AIs) portion in the Public Issue of Future Supply Chain Solutions Limited Limited for 2,935,370 equity shares have been subscribed  by 13 AIs at Rs. 664/- per equity share.. The Anchor Investors include: L&T Mutual Fund, DFC Sterling Equiry Fund, HDFC Mutual Fund, Banking Co Limited, Hdfc Trustee Company Limited- Prudence Fund, DSP Blackrock India Tiger Fund, Dreihaus Mutual Funds etc. .
Click here for Complete Future Supply Chain Solutions Limited Anchor Investors List

Consolidated opinion of Brokerages, Analysts, Business New Paper Reports, Management Views on Future Supply Chain Solutions Limited IPO .

Angel Broking: “In terms of valuations, the pre-issue P/E works out to 39.9x its 1HFY2018 annualized earnings (at the upper end of the issue price band), which is lower compared to its peers like Mahindra Logistics. However, Mahindra Logistics has lower promoter group business (internal business), which is ~54% v/s. ~70% of FSCSL. Further, Mahindra Logistics had reported non-promoter revenue CAGR of ~46% v/s. de-growth of FSCSL over FY15-17. Despite the above favorable factors and lower valuations compared to Mahindra Logistics, we however, believe that all the positives are fully factored in the company’s current valuations, which does not provide any further upside for investors. Hence, we recommend Neutral rating on the issue.”

Capital Market: ” Rating 50/100, Its nearest competitor is Mahindra Logistics (ML), which reported net sales and PAT of Rs 2666.59 crore and Rs 45.59 crore, respectively, for FY 2017 and whose FY 2017 EPS stood at Rs 6.4. ML’s IPO ((closed on 2 November 2017) was priced at Rs 429 and offered at P/E of 66.9. At the current market price of Rs 452, ML is trading at 70.6 times its FY 2017 earnings. “

Choice Broking: “SUBSCRIBE with CAUTION: At the higher price band of Rs664 per share, FSCS’s share is available at a P/E multiple of 39.9(x) to its FY18E annualized EPS of Rs16.4, which appears reasonable considering strong growth and expanding margins. Its peer Mahindra logistic share is available at P/E(x) of 54 to FY18E annualized EPS.” 

Dalal Street Investment Journal: “Rating 48/100; At the upper price band, FSC will command market cap of Rs 2660 crore, and hence market cap-to-sales comes to around 3.72x (after annualising H1FY18 sales), which looks a little bit on the higher side. For H1FY18, the company posted EPS of Rs 8.52, and annualising this, we get EPS of Rs 17.04. At the upper price band, the PE of the company works out at 39x. Even at FY17 EPS of Rs 11.24 at the upper price band, the PE comes to around 59x. This is, however, in line with PE of another listed player.  Looking at a fair valuation and good growth prospect, we advise our readers to subscribe to this IPO.”

Emkay Research: “FSCSL is well-positioned to capitalize on upcoming opportunities in the logistics sector. For investors with a 3-5 year time horizon, it will offer steady compounding returns. Given that the company is also expected to benefit from the GST, the IPO seems suitable for retail investors with a high risk appetite looking to make a long term investment.

GEOJIT FINANCIAL SERVICES: “Going ahead, the management intends to capitalise on opportunities arising from recent GST roll out, growth in third party logistics industry, technology and process enhancements and market share expansion through customised and new service offerings. At an upper price band of Rs 664, FSCL is available at a reasonable valuation of 41x on annualized HIFY18 EPS. The brokerage recommends subscribing to the issue, with a medium-to-long term perspective.”

“FSCL offers attractive growth opportunities in medium to long-term with the commensurate growth in 3PL logistics. The Company is one of the key players especially in the context of expected pick-up in relevance of 3PL logistics in GST regime. Our back of the envelope calculations suggest that the stock is valued at 26.9x FY20E EPS, and hence we believe the IPO is fairly priced vs. versus peers. We recommend subscribing to the Issue, as it provides a healthy investment opportunity for the long-term investors.”

SMC : “
Rating 2/5. The company is one of the largest third-party logistics service operators offering automated and IT enabled warehousing, distribution and other logistics solutions. However, the Company is heavily dependent on machinery and equipment for its operations. Any breakdown of its machinery or equipment will have a significant adverse effect on its business. Also, this issue is offer for sale and no amount would go to the company. On the valuation front, it looks expensive.”

SP Tulsiyan website: “Future Supply Chain has demonstrated stellar growth in the recent past, which coupled with cheaper valuation vis-à-vis direct peer Mahindra Logistics makes this IPO attractive and hence a subscribe. One can expect both listing gains and double digit percentage returns from the stock, over the medium term.”

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