Popular Vehicles & Services Ltd IPO

Long standing presence in the automobile industry and well-established relationships with leading OEMs.

Penetration in markets in which the company operates complemented by innovative marketing strategies.

Fully integrated business model leading to business stability and higher margin.

Proven ability to identify and capture inorganic as well as organic growth opportunities.

Consistent track record of profitable financial performance and increasing growth.

Experienced promoters and management team.

The automotive industry is sensitive to changing economic conditions and various other factors. Any decline in demand for vehicles by individuals or entities may adversely impact its business prospects and results of operations.

The company is subject to the significant influence of its OEMs. The companys top two OEMs i.e., Maruti Suzuki and Tata Motors (commercial), account for more than 80% of the Companys consolidated revenue in the six months period ended September 30, 2023 and each of Fiscal 2023, 2022 and 2021. Such significant influence of its OEMs and restrictions imposed by them pursuant to the terms of its dealership agreements may adversely impact the companys business, results of operations, financial condition and prospects, including our ability to expand into new territories and acquire additional dealerships.

Non-renewal, termination or any adverse material modifications made by its OEMs to the dealership agreements, will have a material and adverse impact on its business prospects and results of operations.

The Company has not received the required approval from the Central Government for appointment of John K. Paul as a Whole-time Director of the Company. The company cannot assure you that such approval will be received in a timely manner.

The company has had negative cash flows in the past including negative cash flows from operating activities in the six months period ended September 30, 2023, and it is possible that the company may experience negative cash flows in the future which could adversely affect its cash flow requirements, its ability to operate the companys business and implement its growth plans, thereby affecting its financial performance.

A large portion of its business operations, which is approximately 96.91% the Companys consolidated revenue for the six months period ended September 30, 2023, are concentrated in the states of Kerala, Tamil Nadu and Karnataka. Any adverse developments (including any natural calamities) in these states could have an adverse effect on its business, results of operations and financial condition.

A large portion of its business revenue, approximately 77.03%, is derived from the company dealership of Maruti, Tata Motors (Commercial) and Honda. Any adverse developments in the growth, demand or sales for these OEMs could have an adverse effect on its business, results of operations and financial condition.

Increasing competition among automotive dealerships through online and offline marketing reduces its profit margins on vehicle sales and related businesses.

Its success depends on the value, perception, marketing and overall competitiveness of its brand and the companys OEMs in India. Any damage to its or the companys OEMs brands or its failure to compete effectively in India could materially and adversely affect its business, results of operations and financial condition.

The determination of the Price Band is based on various factors and assumptions and the Offer Price of the Equity Shares may not be indicative of the market price of the Equity Shares upon listing on the Stock Exchanges. Investors bear the risk of fluctuations in the price of Equity Shares and there can be no assurance that a liquid market for its Equity Shares will develop following the listing of the companys Equity Shares on the Stock Exchanges.