Paradeep Parivahan makes weak debut, shares list at 20% discount on BSE SME; check details

Shares of small and medium enterprise (SME) Paradeep Parivahan Ltd made a disappointing trading debut on Monday, March 24, with the stock listing at a 20% discount on the BSE SME platform.

The Paradeep Parivahan stock opened the trading session at ₹78.4 apiece, down 20% compared to its initial public offering (IPO) price of ₹98 per share. Within minutes of the opening of the session, the share price plunged another 5% to hit the lower circuit limit at ₹74.48 apiece.

Within minutes of listing, more than 95,000 shares changed hands on the BSE SME platform. The total turnover stood at ₹72.81 lakh. The market valuation of the company stood at ₹118.56 crore.

As the lot size, or the minimum bid quantity, to apply for the Paradeep Parivahan IPO was 1,200 shares, successful bidders who were allotted shares in the primary issue would have suffered a wealth erosion of ₹23,520 per lot (₹19.6 x 1,200) as soon as the stock started trading in the secondary market.

The muted listing of Paradeep Parivahan shares was not a surprise as the investors’ response to the IPO, which was open for bidding from March 17 to March 19, was also underwhelming.

Paradeep Parivahan IPO key details

The issue was overall subscribed 1.78 times during the three-day bidding window, with total bids for 49.55 lakh shares compared to 27.88 lakh shares on offer.

The non-institutional investors’ (NII) category was the most subscribed at 2.65 times and the retail investors’ portion was booked 1.66 times. Meanwhile, the qualified institutional buyers (QIBs) quota was bought 1.33 times.

The Paradeep Parivahan IPO was a book-built issue that aimed to raise a total of ₹44.86 crore. The BSE SME IPO was made up entirely of fresh issuance of 45.78 lakh shares, with no offer-for-sale (OFS) component.

Shares in the IPO were offered at a price band of ₹93 to ₹98 apiece in a lot size of 1,200 units.

Ahead of the launch of the IPO, Paradeep Parivahan had also raised ₹11.69 crore through its anchor investor round.

The company had said in its red herring prospectus (RHP) that the funds generated from the IPO will be used to meet its working capital requirements as well as for general corporate purposes.

Paradeep Parivahan had appointed Share India Capital Services Pvt Ltd as the issue’s book-running lead manager, while Bigshare Services Pvt. Ltd was hired as the registrar. The market maker for the IPO was Share India Securities Ltd.

Established in 2000, Paradeep Parivahan is a port service provider located at the Paradip Port, Odisha. The company operates across multiple locations, including Gopalpur, Paradip, Haldia, Visakhapatnam, Jajpur, Joda and Barbil, Chandikhol, Cuttack, and Talcher, catering to diverse sectors like cargo shipping, cement, steel, and railway siding.

According to the company, it is well anchored in all areas like custom house clearing and forwarding agency, ship husbandry services, close liaison with the port authorities and other shore agencies to ensure the fastest turnaround period for the vessel.

Paradeep Parivahan also has a large fleet of material handling and earth-moving equipment, along with a fleet of dumpers, trailers and covered trucks.

Paradeep Parivahan key financials

For the first six months of the current financial year 2024-25 ended September 2024, the company’s revenue stood at around ₹138 crore, while profit after tax (PAT) was ₹5.18 crore. In the previous financial year 2023-24, the full-year revenue was ₹211.6 crore compared to ₹202.81 in 2022-23. PAT in FY24 was ₹15 crore compared to ₹6.56 crore in FY23.