Landmark Cars Limited IPO Details
In the year 1998, Landmark Cars Limited began operations and opened its first Honda dealership & is the leading premium automotive retail business in India with dealerships for Mercedes-Benz, Honda, Jeep, Volkswagen, Renault new commercial vehicles of Ashok Leyland. The group recently announced its association with China-based electric vehicle (EV) manufacturer BYD for the sale and after-sales services of its EVs in India.
As of September 30, 2021, the company’s network had grown to 112 outlets in 8 Indian states, including 61 showrooms and outlets for sales and 51 after-sales services and spare parts stores.
The business serves as a Mercedes-Benz, Honda, Volkswagen, Jeep, Renault, and Ashok Leyland authorised service centre. As of September 30, 2021, Landmark Cars additionally offered after-sales maintenance and repairs through 51 after-sales service and spare outlet locations.
The business model of the company includes the distribution of third-party finance and insurance products, as well as the retailing of new automobiles, servicing and repairing of vehicles, sales of spare parts, lubricants, and other items, and sales of pre-owned passenger vehicles.
Objective of the Issue
Company proposes to utilise the Net Proceeds from the Fresh Issue towards funding the following objects:
- Pre-payment, in full or in part, of borrowings availed by our Subsidiaries; and
- General corporate purposes.
| Landmark Cars Limited IPO | Details |
|---|---|
| Price Band | ₹ 481 to ₹ 506 per share |
| Face Value | ₹ 5 per share |
| Issue Size | 552 Crs |
| Opening Date | 13 Dec 2022 |
| Closing Date | 15 Dec 2022 |
| Allotment | 20 Dec 2022 |
| Initiation of Funds | 21 Dec 2022 |
| Credit to Demat | 22 Dec 2022 |
| Listing Date | 23 Dec 2022 |
| Pre Issue Share Holding | 60.24% |
| Post Issue Share Holding | 44.61% |
| 1 lot | 29 Shares |
| Retail Quota | 35% |
| QIB Quota | 50% |
| NII Quota | 15% |
| Retail (Min) | 1 Lot (29 Shares) |
| Retail (Max) | 13 Lots (377 shares) |
| S-HNI (Min) | 14 Lots (406 Shares) |
| B-HNI (Min) | 69 Lots (2001 Shares) |
| Promoters | Sanjay Karsandas Thakker |
| Draft Red Herring Prospectus | DRHP |
| Red Herring Prospectus | RHP |
| Grey Market Premium | Click Here |
| Allotment Status | Check Here |
The Landmark Cars Limited IPO’s bid period is from December 13, 2022, at 10:00 A.M., to December 15, 2022, at 5:00 P.M. UPI Mandate confirmation must be received by 5 PM on the day the issue closes.
EBITDA & PAT (in Crs)
EBITDA– Earnings Before Interest Tax Depreciation & Amortization PAT – Profit After Tax
Total Assets, Share Capital and Borrowings (in Crs)
Revenue Growth (in Crs)
Financial Ratios
| Particulars | Landmark Cars Limited |
|---|---|
| Face Value | 5 |
| EPS | 17.45 |
| PE | 28.99 (taking 506 as the listing price) |
| RoNW% | 26.52 |
| Revenue from Operations (in ₹ Crs) | 2976.52 |
| EBITDA Margin (%) | 6.27 |
| PAT Margin (%) | 2.22 |
| ROE | 26.66 |
| Debt to Earnings Ratio | 1.49 |
Analysis:
If we analyse the financial parameters of Landmark Cars Limited, then it can be clearly seen that the firm is on the growth path with both EBITDA and PAT increasing on year to year basis. Total assets of the company in comparison to its borrowings are continuously increasing on YOY bais. However, the firm’s revenue growth is a roller coaster ride declined till FY21 then increased to highest levels in FY22.
As per the RHP, EPS is 17.45 and if we calculate the PE ratio based on the cut off price then PE ratio is in the range of 28.99. EPS and PAT margin are increasing consistently on YoY basis as per RHP report. However, EBITDA margin of 6.27% on the lower end.
Debt to earnings ratio of 1.49 simply depicts that the borrowing are not covered by the earnings and this may lead to increased debt in future. Moreover, this firm provides sales and services of premium car OEMs, most of the OEMs have their own outlets and service stations across the nation and can provide cheaper services than the firm. As we see, in India, car market is dominated by Maruti, Hyundai, Mahindra and Tata brands so in future, it might be possible that the firm might loose on profit margins.
Generally, OEMs hold the hands of the firm to start capturing the foreign market and when they start capturing the market then those OEMs starts rollling out their own sales and services outlets. This might be a biggest drawback for the firm. This firm has no value added product on which we can have long term vision. So, this IPO can be avoided for now.