INOX India shares debut at 44% premium over IPO price
Cryogenic tank maker INOX India made a strong debut on the domestic bourses on Thursday, listing at a premium of 43.9% above the IPO price. The shares of INOX India opened at ₹949.65 on the NSE against the issue price of ₹660 apiece. On the BSE, the stock listed at ₹933.15, up 41.4% over the IPO price.
Post listing, INOX India stock gained as much as 48.3% to ₹979, while the market capitalisation increased to ₹8,497 crore.
Despite a strong debut, the listing of INOX India was below expectations as the stock was commanding a grey market premium (GMP) of ₹530 a day ahead of listing, up 88% over the issue price of ₹660. The stock has created a buzz in the grey market after garnering strong interest from investors in the IPO.
“The IPO received a huge subscription of 61.28x. Though we can consider it a decent listing, it is still below expectations, and the reason behind this is poor market sentiment. Inox India is the leading cryogenic equipment supplier in India, benefiting from rising demand in sectors like healthcare, space exploration, and food processing,” says Shivani Nyati, Head of Wealth, Swastika Investmart.
“With strong fundamentals and a growing market, the company has the potential for long-term value creation; thus, we recommend holding it with a long-term view. Also, fresh buying at a lower level can be considered,” Nyati adds.
The ₹1,459.32 crore IPO of INOX India (INOXCVA), one of the country’s leading cryogenic tank makers, was subscribed 61.28 times on the last day of bidding, on the back of huge participation from institutional buyers. The portion reserved for Qualified Institutional Buyers (QIBs) was booked 147.80 times, while that of non-institutional investors portion received 53.20 times subscription. The retail investors segment was subscribed 15.29 times. The company had reserved half of the issue for QIBs, 15% for NIIs, and remaining 35% for retail investors.
The issue, which was completely an offer for sale (OFS), was sold in the ₹627-660 price band from December 14 to December 18, with most analysts, including Motilal Oswal Securities, Geojit Financial Services, SBI Securities, giving 'subscribe' rating to the issue. The lot size for the IPO was 22 equity shares and in multiples of 22 shares thereafter. This means, minimum investment amount for retail investors was ₹14,520 for 1 lot and ₹1,88,760 for 286 shares, or 13 lots.
Formed in 1976, INOX India is one of the largest manufacturers of cryogenic storage, re-gas and distribution systems for LNG, industrial gases and cryo-scientific applications with operations in India, Brazil & Europe. The company has an extensive user base, spread across more than 100 countries and is serviced by a network of after-sales support associates in 25 countries. It is leading India’s efforts to use LNG for industrial and automotive use. The company’s key strength lies in design engineering, manufacturing, supply and commissioning of cryogenic turnkey packaged systems.
INOX India posted a 23.9% year-on-year (YoY) rise in net profit to ₹103.3 crore in the six months ended September FY24. The revenue climbed 16% over the last year to ₹564.6 crore in H1 FY24. For the financial year ended March 31, 2023, the company posted a 17% YoY growth in net profit at ₹152.7 crore, and revenue increased by 23.4% to ₹966 crore.
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