LNP – Kapruka IPO snapped up even before official opening

The Rs. 500 million worth Initial Public Offering of Kapruka Holdings Ltd. has been snapped up even before its official opening which was yesterday.

Following the oversubscription, the issued closed at 4:30 p.m. yesterday.

In an early morning filing to the Colombo Stock Exchange, the registrars to the issue PW Corporate Secretarial Ltd., said applications for over Rs. 825 million had been received. The final figure is expected to be announced next week.

Sri Lanka’s pioneering e-commerce platform Kapruka aimed to raise Rs. 505 million via the IPO of 32,826,000 ordinary voting shares, reflecting a 20% stake in the company, at a price of Rs. 15.40 per share.

At a per-share price of Rs. 15.40, shares of Kapruka present investors with an attractive 10x forward PER. The company plans to use the IPO to fund its expansion and growth plans, which include upgrading existing technology and infrastructure, alongside launching various Kapruka platform services. Four main Kapruka platform services projects are in the works, including ‘Kapruka B2B’ for business-to-business ecommerce; ‘soldout.lk’ for used goods, a platform for Kapruka to act as a distributor for established Sri Lankan brands in foreign markets; and ‘Kapruka Partner Central’ for established brick and mortar shops looking for an e-commerce partner with a wide reach.

Founded in 2002, Kapruka through its website, facilitates online purchases of goods for its Sri Lankan and expatriate customer base. The company has a well-integrated supply chain and sells its own-label products, predominantly Kapruka cakes, flowers and value-added fruits and vegetables. The company partners with over 500 high-end brands and executes order fulfilment and delivery for its online orders. Kapruka strives to provide a non-marketplace model and a superior online shopping experience to consumers.

The company caters to over 1.1 million expatriate Sri Lankans, predominantly in the USA, who regularly use Kapruka to send gifts to their family and friends in Sri Lanka. Further, the company offers Sri Lankan brands on global e-commerce platforms such as Amazon, eBay, Etsy and Walmart, and is the e-distributor/e-commerce retailer for well-established brands such as Dilmah, Akbar, Link Samahan and many more. Kapruka is also one of the few e-commerce companies in Sri Lanka that generates Dollar revenues by serving expatriate Sri Lankans and other global customers. The company has its central office located in Colombo, along with offices in the USA, the UK and Australia.