The KRN Heat Exchanger and Refrigeration Limited IPO has generated significant buzz ahead of its listing on October 3, 2024. Investors are keenly observing the grey market premium (GMP), which serves as an indicator of potential listing gains. As of now, the GMP stands at approximately ₹240, suggesting a listing gain of about 110% over the issue price. This comes after the IPO saw overwhelming demand, being oversubscribed 214.42 times during its subscription period from September 25 to September 27, 2024.
Main Points
KRN Heat Exchanger IPO Overview
KRN Heat Exchanger is a Rajasthan-based company specializing in manufacturing fin and tube-type heat exchangers for the HVAC&R (Heating, Ventilation, Air Conditioning, and Refrigeration) industry. The IPO aimed to raise around ₹342 crore by offering shares in a price band of ₹209 to ₹220 per share, with a minimum bid of 65 shares per lot.
KRN Heat Exchanger IPO Subscription Details
The IPO received bids for 2,357,139,005 shares, far exceeding the 109,930,000 shares offered. The breakdown of subscriptions is as follows:
- Non-Institutional Investors (NIIs): Oversubscribed 431.63 times
- Qualified Institutional Buyers (QIBs): Oversubscribed 253.04 times
- Retail Individual Investors (RIIs): Oversubscribed 98.29 times
This robust interest indicates strong market confidence in KRN Heat Exchanger’s business model and growth prospects.
KRN Heat Exchanger IPO Grey Market Premium (GMP)
The GMP is a crucial metric for investors looking to gauge potential listing gains. Initially reported at around ₹270 prior to the allotment announcement, it has since adjusted to ₹240. Despite this decline, expectations remain high for a successful market debut.
Factors Influencing GMP
Several factors contribute to the fluctuations in GMP:
- Market Sentiment: Positive reviews from analysts and brokerages have bolstered investor confidence.
- Company Fundamentals: KRN Heat Exchanger reported revenues of ₹308 crore for FY24, indicating strong financial health.
- Product Demand: The company’s products are integral to various sectors, enhancing its market position.
KRN Heat Exchanger IPO Analyst Recommendations
Analysts have expressed optimism regarding the KRN Heat Exchanger IPO. For instance:
- Deven Choksey Research recommends subscribing to the IPO based on its strong growth potential within the HVAC&R sector.
- Other analysts suggest that investors who received shares should consider booking profits on listing day while keeping an eye on future performance.
KRN Heat Exchanger IPO Future Prospects
KRN Heat Exchanger plans to utilize the funds raised from the IPO primarily for expanding its manufacturing capabilities through its wholly-owned subsidiary, KRN HVAC Products. A new facility is set to be established in Neemrana, Alwar, Rajasthan. This expansion is expected to enhance production capacity and meet growing market demands.
KRN Heat Exchanger IPO Financial Performance
For FY24, KRN Heat Exchanger reported:
- Revenue: ₹308 crore
- Net Profit: ₹39 crore
These figures reflect a year-on-year growth of approximately 25% in revenue and 22% in net profit compared to previous fiscal years.
