Friday, January 29, 2010

Indian 3PL Group Aqua Logistics Extend Investment Deadline

“Lukewarm” Response in Difficult Market
Shipping News Feature

INDIA – Having failed to attract sufficient subscriptions to its initial public offering (IPO) on the secondary market after two week falls on the Bombay Stock Exchange of around 8%, Mumbai based Aqua Logistics, whose interests range from shipping and transport to heavy lift and project freight forwarding, were forced to extend the offer until the 2nd February.

Analysts compared the situation to that of early 2008 as, according to observers, investors only stumped up around 60 or 70% of the offers required which prompted the group to cut the price band to Rs200 – 225 ($4.31 -$4.85) per share. The company says it requires investment for expansion, acquisitions and purchase of specialised equipment. With 6.82 million shares on offer the group is looking to raise around Rs 150,000 ($30 million).

According to the company’s website the offer has not been helped by a report allegedly prepared by Main Street Research titled 'Aqua Logistics IPO Note', which Aqua describes as “doing the rounds”, which attacks facts and omissions in the companies red herring prospectus (RHP). A rebuttal to the report is available on the Aqua website which they claim was prepared by an independent analyst. In this the author says the report is forged as the company website and e mail details shown for Main Street are non existent.

As with other countries investors are showing caution and this applies to the freight sector as well as elsewhere, but the potential for growth in India with infrastructure development and improved facilities remains and analysts will be watching the market keenly for a return of confidence.

Pic: Bombay Stock Exchange