KARACHI: Universal Network Systems Ltd (UNSL), a logistics firm operating under the brand name of BlueEX, is looking to raise Rs445.7 million in an initial public offering on the Pakistan Stock Exchange (PSX).

“Accredited investors” will be able to subscribe to 6.85m ordinary shares — 25 per cent of the company’s post-issue paid-up capital — at the fixed price of Rs65 apiece on Nov 17-18 on the PSX’s Growth Enterprise Market (GEM) board.

It’ll constitute the second listing on the GEM board, which is reserved for “growth companies” carrying higher investment and liquidity risks than mature companies listed on the main board of the exchange. Pak Agro Packaging Ltd raised Rs198m by selling its 40pc post-listing stake through the GEM board early this month.

UNS was incorporated in 2005 as a domestic cargo consolidator. It shifted its focus towards e-commerce logistics in 2011 and conducted the country’s first cash-on-delivery shipment under the BlueEX brand.

Speaking to Dawn on Tuesday, UNSL Chief Financial Officer Salman Hameed said the company’s share in the country’s e-commerce market is 6-8pc. “E-commerce has grown significantly in the last two years because of Covid-19. Its size in Pakistan should be more than $2 billion. I see it growing to $6-7bn in the next five years,” he said.

The purpose of going public is to raise funds for the expansion of the company’s infrastructure facilities. “We want to take the number of our stations from 35 to 160 in the next three years,” he said while referring to distribution hubs that the company uses to route parcels from Karachi to Muzaffarabad.

“We don’t really consider TCS as our competitor because it operates mostly in the envelope business. Their share in e-commerce is smaller,” said Mr Hameed, adding that the total value of cash-on-delivery goods that BlueEX moves every year is around Rs7bn.

Speaking to Dawn, one of the two joint advisers to the issue, Topline Securities CEO Mohammed Sohail, said the decision to go public without underwriting the issue will save the company at least 2-3pc of the transaction value. “Underwriting costs are high. We asked the PSX and it granted us the permission to go without underwriting,” he said.

Published in Dawn, November 10th, 2021