KP Green Engineering IPO: Largest SME IPO In The History of Capital Markets To Open On 15th March

For its initial public offering, Gujarat-based KP Green Engineering Limited, a producer of hot-dip galvanized steel structures, has set a price band of Rs 137 to Rs 144 per equity share with a face value of Rs 5 apiece. The company's initial public offering (IPO) will go live for subscriptions on Friday, March 15, 2024, and end on Tuesday, March 19, 2024. Investors may place bids in multiples of 1000 equity shares following the minimum bid of 1000 equity shares. Therefore, retail investors need to invest a minimum of Rs 144,000. For HNIs, the minimum lot size investment is two lots of 2,000 shares, or Rs 288,000, which is needed for the minimum bid. The floor price is 27.4 times the face value of the equity share and the cap price is 28.8 times the face value of the equity share as per the DRHP. The largest SME initial public offering (IPO) in the history of the capital markets is KP Green Engineering, with a total issue size of Rs 189.50 crs at cap price.

The KP Green Engineering IPO is a completely new offering of 131.6 lakh shares and is a book-built issue of Rs 189.50 crores. The issue consists of a fresh issue of up to 1,31,60,000 equity shares with no "Offer for Sale" (OFS) component from promoter and promoter group. On Wednesday, March 20, 2024, the allocation of shares for the KP Green Engineering IPO is anticipated to be completed. The proposed listing date for the KP Green Engineering IPO is set for Friday, March 22, 2024, on the BSE SME platform.

The issue is being made through the book-building process, with the following restrictions in place: retail individual bidders will be able to acquire not less than 35% of the net issue, 15% of the net issue will be available for buying to non-institutional investors, and more than 50% of the net issue will be available to qualified institutional buyers.
In order to partially finance the capital expenditure towards setting up a new manufacturing unit to expand its current production capabilities as well as expanding its current product portfolio, the company proposes to use up to Rs 156.14 crores of the total net proceeds to be raised through the offer. The manufacturing facility's total project cost is Rs. 174.04 crores.

In the fiscal year FY23, KP Green Engineering Limited had a net profit of Rs 12.40 crores, a 2.73-fold rise in profits from the previous year's Rs 4.54 crores. FY23 saw an enormous increase in revenue, up 47% to Rs 114.21 crores from Rs 77.70 crores the year before. This growth was mostly attributable to higher sales of products and services. Revenue from operations for the six months ending in September was Rs 103.93 crores, while profit after taxes was Rs 11.27 crores. The company has 69 projects as of December 31, 2023, with a total order book value of around Rs 233.91 cr.

KP Green Engineering was established in 2001 and focused on producing steel products that were hot-dip galvanized. Lattice tower structures, substation structures, solar module mounting structures, cable trays, earthing strips, beam crash barriers, and other infrastructure solutions are all part of its wide product line. It also provides solar installation services, galvanizing project work, and Fault Rectification Services (FRT) for optical fiber cables.
The registrar of the KP Green Engineering IPO is Bigshare Services Pvt Ltd, while the book-running lead manager is Beeline Capital Advisors Pvt Ltd. Spread X Securities is the market maker for the KP Green Engineering IPO.