Are you all set to invest in the upcoming INOX India IPO? Before you decide whether or not it will be worth opting for this IPO, carefully consider some of the most crucial things with this comprehensive guide. Here are the 10 things you must know about the INOX IPO dates, price, issue size, and more.
INOX India IPO Overview
INOX India is a leading name for end-to-end cryogenic equipment and systems services. The company is set to open its IPO on 14 December, which calls for a look at the key factors of the offering.
A Look at INOX India’s Background
Headquartered in Vadodara, Gujarat, INOX has more than 30 years of experience in providing comprehensive solutions in the design, engineering, manufacturing, and installation of equipment and systems for cryogenic environments.
The company’s portfolio also includes prominent projects catering to various industries, such as industrial gases, liquefied natural gas (LNG), energy, steel, medical and healthcare, aviation and aerospace, etc.
Key IPO Details to Know
1. Offer-for-Sale (OFS) Structure
INOX India’s public issue solely involves an Offer for Sale (OFS) by its promoters and current shareholders, meaning the company won’t receive any proceeds from the IPO. Within this OFS, the company’s stakeholders — Siddharth Jain, Pavan Kumar Jain, Nayantara Jain, and Ishita Jain — will sell their shares in the company.
2. Total Equity Shares and Fundraising
The company aims to raise ₹1,459.32 crore via its initial IPO of up to 22,110,955 equity shares at a face value of ₹2 each.
3. Key dates
With a five-day bidding window, the INOX IPO opens on 14 December 2023, and closes on 18 December 2023, while the date for allocation to anchor investors is set to 13 December. The company’s shares are scheduled to be listed on both BSE and NSE on Thursday, December 21. The share price band is fixed at ₹627-660 per share.
4 Lot size
Investors can place a minimum bid of 22 shares and in multiples thereafter.
5. Floor Price
The share’s floor price stands at ₹313.50 times the face value of the equity shares, whereas the cap price is set at ₹330 times the face value of the equity shares.
6. Reserved Quota for Shareholders
INOX has set aside a 50% quota for qualified institutional bidders (QIBs), with 15% allocated to non-institutional investors. The remaining 35% of the offer is designated for retail investors participating in the issue.
7. Gray Market Premium (GMP)
The current grey market premium (GMP) for the INOX India IPO stands at ₹200, indicating a trading value of ₹860 per share, representing a premium of more than 30%.
8. Cost of Acquisition and Company Valuation
According to the Draft Red Herring Prospectus (DHRP) filed by INOX India for its IPO:
Cost of Acquisition:
Promoter shares: The weighted average cost of acquisition (WACA) per share for promoter shares is ₹2.15 on a fully diluted basis.
Other selling shareholder shares: The WACA per share for other selling shareholder shares ranges from ₹0.13 to ₹4.85 on a fully diluted basis.
Company Valuation:
Pre-IPO valuation: The pre-IPO valuation of INOX India based on the discounted cash flow (DCF) method is estimated to be between ₹14,897 crores and ₹18,037 crores.
Post-IPO valuation: Assuming a price band of ₹627-660 per share, the post-IPO valuation of INOX India is estimated to be between ₹20,615 crores and ₹21,722 crores.
These are estimates based on information available in the DHRP. The actual cost of acquisition and company valuation may vary depending on the final offer price and other factors.
9. Financial Performance
For the fiscal year concluding on 31 March 2023, the company disclosed a net profit of ₹152.71 crore alongside total revenue amounting to ₹984.20 crore, highlighting a robust financial standing.
10. Book-Running Lead Managers and Registrar Details
ICICI Securities and Axis Capital serve as the book-running lead managers for the InoxCVA IPO, while Kfin Technologies has been assigned as the registrar for the issue.
| STRENGTHS | WEAKNESSES |
| Leading Market Position: A strong position in the global cryogenic storage and transport equipment market, with a significant share and established brand recognition. Global Presence Established operations and distribution networks across various countries serve a broad international customer base, ensuring market reach and diversification. Strong Financial Performance: A healthy financial profile with consistent revenue growth and profitability demonstrates long-term sustainability. | Dependence on Specific Industries: Success depends heavily on the performance of specific industries like healthcare and space research, making it susceptible to fluctuations in these sectors. Competition from Established Players: Competitive cryogenic market with seasoned international players poses challenges in market share and pricing. Limited Diversification: Primary focus on cryogenic storage and transport limits growth opportunities in other cryogenic applications. Fluctuating Raw Material Prices: Raw materials costs (like stainless steel) can impact production costs and profit margins |
| OPPORTUNITIES | THREATS |
| Growing Cryogenic Applications: Potential growth prospects of demand for cryogenic technology across various sectors, including clean energy, electronics, and biotechnology. Emerging Markets: Expanding into new and emerging markets with increasing demand for cryogenic solutions provides expansion opportunities. Technology Advancements: Continued investment in research and development can lead to the development of new and innovative solutions, enhancing competitiveness and market share. Partnerships and Collaborations: Strategic partnerships with key players in the cryogenic industry can expand market reach, access new technologies, and enhance efficiency. Focus on Sustainability: Developing and promoting environmentally friendly cryogenic technologies can attract new customers and enhance brand image. | Economic Downturns: Recessions can negatively impact investments in industries that rely heavily on cryogenic technologies. Strict Regulations: Increasingly stringent regulations regarding the transportation and storage of cryogenic fluids can complicate operations and require severe compliance efforts. Technological Disruptions: Advancements in alternative technologies for storing and transporting gases or other applications may pose future threats. Unforeseen Events: Geopolitical instability, natural disasters, or public health emergencies can disrupt global supply chains and negatively impact operations. |
Final Thoughts:
As 14 December opens the doors for the INOX India IPO, you must arm yourself with essential knowledge before considering an investment. This guide delves into 10 critical facets of the conglomerate, an established name in the cryogenic space.
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I’m Archana R. Chettiar, an experienced content creator with
an affinity for writing on personal finance and other financial content. I
love to write on equity investing, retirement, managing money, and more.