INOX India IPO: Rs 1,459 Crore IPO Fully Subscribed On Day 1, Latest GMP; Is It Worth Bidding?

Inox India IPO is fully subscribed in just couple of hours of opening on Thursday driven by strong bidding from retail individuals and non-institutional invesyors. However, institutional investors have showed tepid response in the start. This Inox Group-backed IPO is looking to raise to Rs 1,459 crore. The current grey market premium suggests a strong listing for Inox India.

INOX India IPO Latest Subscription Status:

As per the latest data on NSE, at around 1.03 pm, Inox India received bids of 1,71,30,388 equity shares, against the total offered size of 1,54,77,670 equity shares -- registering full subscription of 1.11x.

The portion for retail individual investors (RII) fully subscribed by 1.59x with bids of 1,22,66,518 equity shares against the reserved size of 77,38,835 equity shares. The next in line to full subscription is the portion of non-institutional investors (NIIs) who have bid to about 48,41,364 equity shares, oversubscribing by 1.46x of the reserved size of 33,16,644 equity shares.

However, Qualified Institutional Buyers (QIBs) showed dull demand so far on the first day as the portion for this category only bid for 22,506 shares against their reserved size of 44,22,191 shares at the time of writing.

INOX India IPO GMP Today:

In the grey market, Inox India is receiving a strong demand as well, hinting at a double-digit premium listing. As per Investor Grain, Inox India IPO's last GMP is Rs 445, last updated Dec 14th 2023 11:58 AM. With a price band of 660.00, Inox India IPO's estimated listing price is Rs1105 (cap price + today's GMP). The expected percentage gain/loss per share is 67.42%.

Inox India IPO Details:

The Rs 1,459 crore IPO opened on December 14th and will be available for bidding till December 18. The price bands for the IPO are fixed at Rs 627 to Rs 660 per share. Bids can be made for a minimum of 22 Equity Shares and in multiples of 22 Equity Shares thereafter.

The IPO is purely an offer for sale (OFS)! The company plans to raise funds through an offer of up to 22,110,955 Equity Shares by the selling shareholders.

Here, promoters like Siddharth Jain will sell 10,437,355 equity shares followed by Pavan Kumar Jain and Nayantara Jain who are both selling 5,000,000 Equity Shares each While 1,200,000 Equity Shares will be offloaded by Ishita Jain. Among other shareholders to sell stakes in OFS are -- up to 230,000 Equity Shares by Manju Jain, up to 190,000 Equity Shares by Lata Rungta, up to 13,400 Equity Shares by Bharti Shah, up to 13,400 Equity Shares by Kumud Gangwal, up to 13,400 Equity Shares by Suman Ajmera and up to 13,400 Equity Shares by Rajni Mohatta.

Meanwhile, companies like ICICI Securities and Axis Capital are acting as book-running lead managers (BRLM). While KFin Technologies is the registrar of the issue.

Should You Subscribe For Inox India IPO?

In its IPO note, brokerage STOXBOX said, "As there is a global push to reduce carbon footprint and promote the use of clean source of energy such as LNG and hydrogen, Inox India Ltd. is expected to benefit from the long-term demand for cryogenic equipment. The company's leadership position in cryogenic equipment in India, robust order book, strong product portfolio, marquee clients diversified across sectors and focus on exports should help the company to grow its scale of operations in future. Additionally, the company has delivered healthy financial performance in the past, focused on reduced borrowings and posted strong RoE and RoCE in excess of 25%, thereby providing confidence about its sustained business performance."

Further, STOXBOX's note said, "The company has a track record of sustained Revenue/EBITDA/PAT performance which grew at a CAGR of 27.5%/21.9%/26.0% during the FY2021-23 period. On the upper price band, the issue is valued at a P/E of 39.2x based on FY2023 earnings which we feel is fairly valued. We, therefore, recommend a "Subscribe" rating for the issue."

Also, recommending to subscribe to the IPO, Shivani Nyati Head of Wealth at Swastika Investmart highlighted that Inox CVA is a leading Indian supplier and exporter of cryogenic equipment. The company's extensive product portfolio, diversified customer base, robust order book, and stable financial performance demonstrate its strong competitive position and future growth potential. She further added, that while concerns exist regarding dependence on a limited number of customers, significant export reliance, and raw material price volatility, these are mitigated by the company's strong management team and diversified product portfolio.

On the valuation, Nyati said, "The issue at a P/E valuation of 39.2x appears fully priced in the absence of directly listed peers. However, considering Inox CVA's unique position within the clean energy sector, its consistent dividend history, and its promising future growth prospects, we recommend a Subscribe rating to the IPO for both potential listing gains and long-term capital appreciation."

Disclaimer:

The recommendations made above are by market analysts and are not advised by either the author nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.