Investors in Dhillon Freight Carrier's IPO suffered a severe blow. Shares, issued at a price of ₹72 per share, plummeted by 20% to ₹57.6 upon market opening, and later fell to the lower circuit limit of ₹54.72. Retail investors showed confidence, but the low participation of large investors further exacerbated the losses.
Dhillon freight carrier ipo listing: Dhillon Freight Carrier's IPO was listed on BSE SME on Tuesday, but investors faced significant losses on the very first day. Shares of the company, with an issue price of ₹72 per share, fell to ₹57.6 upon market opening and reached the lower circuit of ₹54.72, resulting in losses of up to 24% for investors. Despite the enthusiasm of small investors, this logistics and transportation company suffered losses due to a weak listing.
Major Setback on Listing
Dhillon Freight Carrier had set the IPO issue price at ₹72 per share. However, on Tuesday, the shares debuted in the market at ₹57.60, which was a shocking situation for investors. Following this, a selling spree intensified, and the share dropped to its lower circuit limit of ₹54.72. Consequently, the capital of IPO investors diminished by approximately 24 percent in just a few hours.
Stock market experts stated that even in the grey market, there was no enthusiasm for this share prior to listing, and the premium was zero. This situation was indicative of the IPO's weak performance.
Small Investors Showed Confidence
Dhillon Freight Carrier's total IPO amounted to ₹10.08 crore. The IPO was subscribed a total of 2.91 times. Retail investors showed the most interest, with their reserved portion being subscribed 4.87 times. In contrast, the portion for Non-Institutional Investors (NIIs) was subscribed only 0.96 times. This clearly indicated that large and informed investors had doubts about the company's valuation and future prospects.
Small investors often invest out of enthusiasm, and this time they bore the brunt of the losses.
Company's Business and Expansion
Dhillon Freight Carrier is a logistics and transportation company. It primarily provides freight services to B2B and B2C clients. The company specializes in services such as LTL (Less-Than-Truckload) parcel transportation, contract logistics, and fleet rental. Its clients come from the textile, electrical goods, paint, and footwear industries.
The company's network extends across West Bengal, Bihar, Delhi, and Uttar Pradesh. It possesses 62 vehicles and 22 offices.
Out of the ₹10.08 crore raised through the IPO, ₹7.67 crore will be spent on purchasing new trucks and vehicles, technology upgrades, and capacity expansion. The remaining amount will be allocated for the company's general expenses.
Mixed Reaction on IPO's First Day
Despite the initial losses in the IPO, the company's investors had a mixed reaction. Some investors are planning to hold onto their investments for the long term, anticipating future growth and expansion prospects. Meanwhile, some small investors expressed disappointment due to the losses incurred on the very first day of listing.
