Secure Logistics Group Ltd (SLG), a prominent Pakistani logistics firm, is gearing up for a significant milestone as it prepares to launch its initial public offering (IPO) next week at the Pakistan Stock Exchange (PSX).
This move marks a pivotal moment for the sector, as Secure Logistics Group becomes the first player in Pakistan’s logistics industry to embark on such an endeavor, aiming to raise approximately Rs600 million ($2.1 million) from public investors.
The IPO, scheduled for March 27 and 28, will employ a book-building process, offering 50 million shares at a floor price of Rs12 each.
Arif Habib Limited (AHL), serving as the sole financial adviser and bookrunner for the deal, underscores the significance of this event, particularly highlighting the discounted book value of the company, a rare opportunity for investors.
Having already secured Rs585 million ($2 million) from strategic investors such as the Saudi Bugshan Group and Karandaaz Pakistan, SLG enters this phase with substantial backing. This pre-IPO equity underscores investor confidence in the company’s prospects and further solidifies its position as a formidable player in the logistics landscape.
Shahid Ali Habib, CEO of Arif Habib, emphasizes the importance of this IPO, not only as a pioneering move within the logistics sector but also as a strategic step towards leveraging the company’s growth potential. With an earnings per share (EPS) of Rs2.28 for 2023 and a book value of Rs17.43 as of December 2023, SLG presents a compelling investment opportunity for prospective shareholders.
The infusion of capital from the IPO is earmarked for pivotal initiatives aimed at fortifying SLG’s market position and driving future growth.
SLG aims to become a regional powerhouse in the logistics domain
Headquartered in Islamabad, Secure Logistics Group boasts a fleet of 283 transport vehicles. Shahid Ali Habib, the exclusive financial adviser for the IPO, anticipates the company’s revenue to surge to Rs2.1 billion in 2023, with a further 28% growth projected for 2024.
As road transport remains the primary mode of freight carriage in Pakistan, SLG’s expansion initiatives hold significant promise for both the company and the broader economy. Road transport dominates Pakistan, comprising 95% of freight traffic, with rail at 3%, and the remainder by air and waterways, per the National Transport Research Center.
Furthermore, SLG’s strategic focus on the China-Pakistan Economic Corridor (CPEC) underscores its forward-looking approach. With plans to capitalize on the opportunities presented by CPEC-related projects, SLG is poised to emerge as a regional powerhouse in the logistics domain.
“SLG will also be pursuing logistics assignments on the CPEC route to Western China (Kashgar) and Central Asian countries which will provide attractive opportunities,” the group said in a statement. “SLG also plans to be a ‘Regional Player’ by connecting with Central Asian markets.”