KRN Heat Exchanger IPO: Public Issue Subscribed 18x On Day 1, GMP Hints Stellar Listing; Check Details

The Initial Public Offering (IPO) of KRN Heat Exchanger, a manufacturer of heat exchanger tubes for the HVAC (Heat, Ventilation, Air Conditioning) and refrigeration industries, opened for subscription on Wednesday, September 25. With an aim to raise approximately Rs 342 crore, the IPO has garnered substantial attention from investors, and the response so far suggests a promising debut on the stock market.

Company Overview
KRN Heat Exchanger has established itself as a player in the HVAC and refrigeration sectors, manufacturing a diverse range of heat exchangers with fins and tubes. Its product portfolio includes sheet metal components, header/copper parts, evaporator units, evaporator coils, and fluid and steam coils. The company's robust growth trajectory is evident in its financial performance, with profits surging from Rs 11 crore in FY22 to Rs 32 crore in FY23, and further rising to Rs 39 crore in FY24.

IPO Size and Structure
The KRN Heat Exchanger IPO is a fully fresh issue with no Offer for Sale (OFS) component, comprising 1.55 crore shares of face value Rs 10 each. The company aims to raise around Rs 342 crore from this issue. The price band for the IPO has been set at Rs 209 to Rs 220 per share.

Lot Size and Minimum Investment
Retail investors can apply for a minimum of 65 shares, with the lot size pegged at 65 shares. Given the upper price band of Rs 220, the minimum investment required stands at Rs 14,300. Retail investors can apply for a maximum of 13 lots.

IPO Dates
The public issue opened on Wednesday, September 25, and will close on Friday, September 27. Investors have three days to participate in this IPO.

KRN Heat Exchanger IPO Subscription Status
As of 3:35 pm on the opening day, the KRN Heat Exchanger IPO had witnessed an overall subscription of 18 times, indicating strong demand across investor categories. The portion reserved for retail investors has been subscribed 19 times, The non-institutional investor category experienced a surge in demand, with a subscription of 37.2 times, and the QIB segment saw a subscription of 1.22 times.

Grey Market Premium (GMP)
The KRN Heat Exchanger IPO has been making waves in the grey market, reflecting heightened investor enthusiasm. As of today, the shares are trading at a premium of Rs 239 per share, indicating that the stock is expected to list at Rs 459, a 108.64% premium over the upper price band of Rs 220.

IPO Allotment and Listing Details
The share allotment for the KRN Heat Exchanger IPO is expected to be finalized on Monday, September 30, 2024. Successful applicants will see the shares credited to their demat accounts on Tuesday, October 1, while refunds will be processed for those who do not receive an allotment on the same day. The company's shares are anticipated to be listed on both the BSE and NSE on Thursday, October 3, 2024.

Utilization of IPO Proceeds
The funds raised through the IPO will primarily be used for investment in KRN Heat Exchanger's wholly-owned subsidiary, KRN HVAC Products Private Limited, to set up a new manufacturing facility in Neemrana, Alwar, Rajasthan. This expansion is expected to enhance the company's manufacturing capabilities and support its growth in the HVAC and refrigeration sectors. Additionally, a portion of the proceeds will be allocated for general corporate purposes.

Financial Performance
KRN Heat Exchanger's financial growth adds to the attractiveness of this IPO. The company reported a profit of Rs 11 crore in FY22, which jumped to Rs 32 crore in FY23 and further increased to Rs 39 crore in FY24.

Anchor Investor Participation
Prior to the IPO opening, KRN Heat Exchanger successfully raised Rs 100.10 crore from 10 anchor investors, signalling strong institutional confidence in the company. The company allocated 45.5 lakh equity shares to anchor investors at a price of Rs 220 per share.

Registrar and Lead Managers
The IPO is being managed by Bigshare Services Private Limited as the official registrar, ensuring a smooth application and allotment process for investors.