Deccan Transcon Leasing shares hit lower circuit after listing at 7% premium on NSE SME

The Deccan Transcon Leasing stock opened the session at ₹116, up 7.5% compared to its initial public offering (IPO) price of ₹108 per share. Within minutes after the session opened, the share price dropped another 5% to hit its lower circuit at ₹110.2 levels.

Since the minimum bid quantity in the Deccan Transcon Leasing IPO was 1,200 shares, successful bidders who were allotted shares in the primary issue were sitting on miniscule listing gains of around ₹9,600 per lot (₹8 x 1,200) as soon as the stock started trading on exchanges.

The ₹65.06-crore Deccan Transcon Leasing IPO was open for subscription from September 13 to September 19. The offer was subscribed 102.60 times during the five-day bidding period.

While the retail category was subscribed more than 127 times, the non-institutional investors’ (NII) portion was overbooked by almost 148 times. The qualified institutional buyers’ portion was, meanwhile, overbid by more than 42 times.

The Deccan Transcon Leasing IPO was a 100% book-built issue. It was a combination of fresh issuance of 55.24 lakh shares, aggregating to ₹59.66 crore, and an offer-for-sale (OFS) of 5 lakh shares, aggregating to ₹5.40 crore.

The price band for the offer was set at ₹102 to ₹108 per share. The lot size for an application was 1,200 shares.

Ahead of the launch of the IPO, Deccan Transcon Leasing had also raised ₹15.12 crore in its anchor investor round. The board of the company at its meeting held on September 12 had finalised allocation of 14 lakh equity shares to a total of six anchor investors at a price of ₹108 per equity share.

In an earlier notification, Deccan Transcon had proposed to utilise the net proceeds from the fresh issuance of shares towards funding capital expenditure requirements for procurement of tank containers, working capital requirements and for general corporate purposes.

Incorporated in 2007, Deccan Transcon Leasing offers tank containers on lease and logistic and supply chain solutions to clients in various sectors.

It is in the business of providing comprehensive freight and shipping solutions, including domestic tank container logistics, tank fleet management, customs clearance and transportation, and non-vessel operating common carrier services.

The company serves customers in industries such as chemicals, pharmaceuticals, FMCG, agriculture, and others, with a focus on specialty chemicals and petrochemicals in 40 countries.

For financial year 2023-24, Deccan Transcon Leasing posted a 15% decline in revenue at ₹153.64 crore compared to ₹180.62 crore in FY 2022-23. Its profit after tax (PAT), however, rose 38% during the same period to ₹11.8 crore, compared to ₹8.55 crore in FY23.