EMP - Popular Vehicles & Services Limited

About  Popular Vehicles & Services Limited

Incorporated in 1983, Popular Vehicles and Services Limited is an integrated automobile dealership owner in India. The company operates its dealership network across four states: Kerala, Karnataka, Tamil Nadu, and Maharashtra. It offers services like the sale of new vehicles, servicing and repairing, spare parts and accessories distribution, sale and exchange of pre-owned vehicles, operating driving schools and facilitating the sale of third-party financial and insurance products. 

The company operates its business through three key segments: dealerships for passenger vehicles covering economy, premium and luxury vehicles. Under this segment, the company caters to automaker brands like Maruti Suzuki, Honda and JLR. The company has commercial vehicle dealerships of Tata Motors and BharatBenz and dealerships of Ather and Piaggio under its electric two-wheeler and three-wheeler vehicles segment. 

As of 31 December 2023, it operates a network of 61 showrooms, 133 sales outlets, 32 pre-owned vehicle showrooms, 139 authorised service centres, 43 retail outlets, 24 warehouses, and seven driving schools. It is present in 43 districts in India across Kerala, Karnataka, Tamil Nadu, and Maharashtra. 

Under its service and repair division, the company serviced 4.19 lakh passenger vehicles, 1.03 lakh commercial vehicles, 4,118 electric two-wheelers and 883 electric three-wheelers in Q2 FY24. It also sold an aggregate of 5,611 pre-owned vehicles. It facilitated the sale of 21,131 and the renewal of 119,803 third-party insurance policies. 

Between FY21 and FY23, it saw a CAGR rise of 19% in its revenue from operations and 25% in its profit. Moreover, the domestic sales of passenger vehicles and commercial vehicles are expected to grow at a CAGR of 6%-8% and 4%-6%, respectively, between FY23 and FY28, which could benefit the company.

And now, Popular Vehicles and Services Limited is coming out with its initial public offer (IPO). The IPO will be an offer for sale as well as a fresh issue. The money raised from the fresh issue will be utilised to repay borrowings availed by the company and its subsidiaries and general corporate purposes. Its shares will be listed on the NSE and BSE.

Here are key details about the Popular Vehicles & Services Limited IPO:

Financial snapshot

Here’s a quick look at Popular Vehicles & Services Limited IPO’s strengths, weakness, opportunities and risks (SWOT analysis)

Strengths and opportunities

1. Long standing presence in the automobile industry backed by the Kuttukaran Group, which has over 70 years of experience in the industry. 
2. Penetration in the market with the help of innovative marketing strategies like its hub and spoke model, and a team of 432 field sales executives in semi-urban and rural areas in Kerala as of 31 December 2023. 
3. Offers fully integrated services through authorised service centres that contribute to higher-margin revenues and business stability by mitigating the cyclicity of the automobile industry. 
4. Ability to capture organic growth as it added 22 showrooms, 23 sales outlets and 47 service stations between FY21 and FY23. 
5. Ability to capture inorganic growth as it acquired eight showrooms, 17 service centres and three sales outlets for BharatBenz in Tamil Nadu and Maharashtra as of 31 July 2023.
6. Consistent financial performance with EBITDA margins of 5%, 5%, 4%, and 5% in FY21, FY22, FY23, and Q2 FY24, respectively.

Risks and threats

1. The automotive industry is sensitive to changing economic conditions, which can affect its business prospects.
2. Experienced negative cash flows from operating and investing activities in Q2 FY24.
3. Had a consolidated indebtedness of ₹637 crore as of 31 December 2023, which binds it to certain restrictive covenants of its agreements. 
4. Sales are dependent on the incentive, marketing, and other programs of the automotive OEMs (Original Equipment Manufacturers).
5. Changes in the various laws and regulations that it is subject to can impact its operations and finances.
6. Passenger and commercial vehicle sales are subject to seasonality and may result in financial fluctuations.

Popular Vehicles & Services Limited IPO details

|Popular Vehicles & Services Limited IPO date

According to the offer document filed by the company with the SEBI, the Popular Vehicles and Services IPO’s opening date – in other words, the Popular Vehicles and Services IPO launch date – will be 12th March 2024. The Popular Vehicles and Services IPO closing date is 14th March 2024. After this, investors will be updated about the allotment status on 15th March 2024.

Investors, who have been allotted shares, can expect them to be credited to their demat account on 18th March 2024. The Popular Vehicles and Services IPO listing date is 19th March 2024. The listing date is the date on which the shares of a company get listed on the bourses – NSE and BSE. 

|Popular Vehicles & Services Limited IPO Price Band

The IPO is an offer for sale as well as a fresh issue. The Popular Vehicles and Services IPO price band has been set between ₹280 and ₹295 per share. Interested investors can choose a price within this band to apply for the IPO. 

The Popular Vehicles and Services IPO listing price will be determined on 19th March 2024. The listing price is the price at which a company’s shares debut on the stock exchanges.

|Popular Vehicles & Services Limited IPO Lot size

The Popular Vehicles and Services IPO details have been declared. The Popular Vehicles and Services IPO lot size is set at 50 shares and an investor can apply for a minimum of 1 lot. Meanwhile, the Popular Vehicles and Services IPO issue size is approx ₹601 crore.

How to pre-apply for the Popular Vehicles & Services Limited IPO?

You can pre-apply for the Popular Vehicles & Services Limited IPO on Upstox. The pre-application for this IPO, which means pre-apply open date, usually begins a day before the IPO opens for subscription. 

Follow these steps to pre-apply for the IPO: 

1. Login to your Upstox account, using your six-digit PIN
2. After successfully logging in, click on ‘Discover’
3. On the Discover tab, you will find the ‘Invest in IPO’ section
4. Under the Invest in IPO section, look for the ‘Popular Vehicles & Services Limited IPO’ tab and click on it
5. Now fill in all the required information, like ‘bid price’ and ‘lot size’
6. Confirm and click on ‘Pre-Apply’
7. Accept the mandate on your UPI app

How to apply for the Popular Vehicles & Services Limited IPO?

If you are interested in this investment opportunity but unsure how to apply for the Popular Vehicles & Services Limited IPO, here we are listing out the steps for you. 

When the public issue opens for subscription, one can follow this step-by-step guide on how to apply for the Popular Vehicles & Services Limited IPO on Upstox: 

1. Login to your Upstox account, using your six-digit PIN
2. After successfully logging in, click on ‘Discover’
3. On the Discover tab, you will find the ‘Invest in IPO’ section
4. Under the Invest in IPO section, look for the ‘Popular Vehicles & Services Limited IPO’ tab and click on it
5. Now fill in all the required information, like ‘bid price’ and ‘lot size’
6. Confirm and click on ‘Apply’
7. Accept the mandate on your UPI app

How to check the Popular Vehicles & Services LimitedIPO allotment status?

When the allotment process is completed, you can check the status of your application on the Upstox app. Share allotment is generally done around five to six days after an IPO closes. 

Here’s a step-by-step guide on how to check the Popular Vehicles & Services Limited IPO allotment status:

1. Login to your Upstox account, using your six-digit PIN
2. After successfully logging in, click on ‘Discover’
3. On the Discover page, you will find the ‘Invest in IPO’ section
4. Under the Invest in IPO section, you will find the ‘View all’ option
5. Once you click on ‘View all’, you will be directed to the ‘IPO’ tab
6. In the ‘IPO’ tab, click on ‘My applications’ 
7. In ‘My applications’, under the History section, your Popular Vehicles & Services Limited IPO allotment status will be mentioned

Check Allotment Status

Open a demat account with Upstox to apply for the Popular Vehicles & Services Limited IPO

To apply for the Popular Vehicles & Services Limited IPO, you need to mandatorily have a demat account. A demat account helps you hold the shares you buy in a dematerialised format. If you don’t have a demat account yet, you can open one with Upstox by visiting our website or by downloading the app.

Here is a step-by-step guide on how to open a demat account with Upstox:

1. Click here to visit the demat account opening page on the Upstox website. 
2. Enter your phone number and other essential details to begin opening a demat account.
3. Upload the scanned copies of your PAN, Aadhaar card, a cancelled cheque, and your bank statement as needed. 
4. Complete the e-verification using the OTP sent to your registered mobile number. 

This is all it takes to open a demat account with Upstox. Easy and quick, right? 

Open Demat Account

Upstox – trading app to apply for the Popular Vehicles & Services Limited IPO

Applying for IPOs with Upstox is extremely easy. The user-friendly interface and top-notch security make Upstox one of the leading trading apps in India.

You can apply for the Popular Vehicles & Services Limited IPO on Upstox, provided you have a demat account. As mentioned in the previous section, you can simply follow the steps to open a demat account with Upstox. The biggest advantage is that when you apply for an IPO using your Upstox account, the brokerage charges are zero.

In fact, courtesy of its robust features and minimal charges, Upstox is among the most preferred trading apps. Lakhs of Indians trust Upstox as it is a reliable trading platform that makes IPO applications easy.