Zarea Limited, one of Pakistan’s largest commodities B2B platforms, is planning an initial public offering (IPO) at the Pakistan Stock Exchange (PSX) to raise at least Rs1 billion ($3.59 million).
Zarea will offer 62.5 million shares, representing 23.81% of its post-IPO paid-up capital, at a floor price of Rs16 per share, through a 100% book-building mechanism.
“The IPO proceeds will be strategically deployed to drive Zareaʼs continued expansion and operational efficiency,” the company said in a press statement released on Friday.
“A significant portion of the working capital will be invested in agri biomass, a rapidly growing sector as businesses increasingly adopt renewable and sustainable energy solutions.
“Additionally, 24% of the proceeds will be utilized to establish an in-house logistics model, allowing Zarea to transition away from third-party logistics providers.
“Furthermore, 12% of the proceeds will be directed toward technology upgrades to ensure scalability and enhance the customer experience. The remaining funds will be allocated to marketing, human resources, and office expansion,” it added.
The company plans to expand its offerings into seven additional commodity categories, including fertilizers, chemicals, and agri perishables.
The book-building phase is scheduled for February 10-11, 2025, followed by the retail subscription period on February 17-18, 2025.
The company has appointed Topline Securities and Growth Securities as joint consultants and book runners.
Pakistan’s IPO market witnessed a remarkable revival in 2024, as the stock market witnessed seven IPOs (including two GEM Board offerings), compared to just one IPO in the previous year.
The total amount raised from investors through the 7 offerings in 2024 stood at Rs8.4 billion, marking the highest level since 2021.
“We attribute this as a good year for IPOs, driven by macroeconomic stability under the IMF program, coupled with positive market sentiment, high liquidity, falling interest rates and political stability, which encouraged equity investment,” an analyst at Topline Securities said last month.