KKR-backed LEAP India falls in trading debut, valued at $725 million

Shares of KKR-backed supply chain logistics firm LEAP India experienced a 5.3% decline in their trading debut on Friday, valuing the company at $725.2 million. The shares were listed at ₹165.9 each on the National Stock Exchange of India, representing a 4.3% premium to their issue price of ₹159. Prior to the public offering, private placement saw Vertical Holdings II sell around $39 million worth of shares.

The IPO comprised both a fresh issue worth $50.3 million and an offer-for-sale amounting to $209.7 million, mostly by KKR-backed Vertical Holdings II. The trading debut took place amidst a lackluster market, with the benchmark Nifty 50 index declining by 0.2%. Retail investors subscribed to 1.71 times the shares reserved for them, primarily due to valuation concerns highlighted by analysts.

Factors such as declining EBITDA margins, sensitivity to utilization and asset recovery, and the absence of direct listed peers have raised doubts regarding near-term earnings visibility and valuation comfort, as noted by Arihant Capital in a recent note.