Sitara Petroleum Service Limited (SPSL) successfully concluded its book-building phase on May 5 with the strike price reaching the upper limit of PKR 18.9 per share due to overwhelming institutional demand.
This IPO was oversubscribed seven times, signaling a major milestone for the Pakistan Stock Exchange and the energy sector.
How did the Sitara Petroleum IPO perform during book building?
The strong interest from high-net-worth and institutional investors led to an oversubscription of seven times the original size as total investor interest surpassed PKR 11.7 billion, making it the third largest IPO in Pakistan's history. Following the success of Interloop and Airlink, this offering marks the third largest in the market.
The total offering consists of 279.9 million shares, which represents 16.66% of the company’s paid-up capital. The book-building portion is now complete, while the general public portion remains fully underwritten to ensure a successful transition to the exchange.
The total transaction size reached up to PKR 4.8 billion. This figure includes an earlier pre-IPO placement worth PKR 1.67 billion. Analysts consider this one of the most notable listings in recent years. Investors rushed to participate, with some reports indicating the cap price was hit within the first ten minutes.
The public subscription phase will proceed as scheduled now that book building is complete. Once the final shares are allocated, SPSL will be officially listed on the PSX.
What will Sitara Petroleum do with the IPO proceeds?
SPSL currently manages one of Pakistan’s largest fuel station and logistics networks. It operates more than 61 fuel stations and maintains a fleet of over 320 oil tankers.
Most of the company's revenue comes from dealer commissions. However, its logistics and carriage services for oil marketing companies represent a rapidly growing segment.
SPSL will use the IPO proceeds to fund its next growth phase. The company plans to add approximately 50 new fuel stations to its existing network.
Additionally, it will expand its logistics fleet by adding 50 new oil tankers to strengthen its national presence. This expansion will solidify the company's role within Pakistan's downstream petroleum value chain and enhance its logistics capabilities.
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