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Geojit Research Report
JNK India Ltd. launched its initial public offering today and the offer will close on April 25. A manufacturer of heating equipment has set the price band in the range of Rs 395-415 per share.
The Rs 649.5 crore IPO comprises of a fresh issue of Rs 300 crore and an offer for sale of Rs 349.5 crore. The minimum order lot is 36.
Purpose of IPO
The offering includes both a fresh issue of Rs 300 crore and an offer-for-sale component of up to 84.21 lakh equity shares valued at Rs 349 crore.
Out of the net proceeds, the company plans to allocate Rs 262.7 crore to support its working capital needs for business operations in FY24, FY25, and FY26.
Key risks
The company's heavy reliance on JNK Global (54% of FY23 revenues) may pose financial risks without new projects. Yet, this dependence has dropped to 27% in 9M FY24.
Capex downturns in the oil, gas, petrochemicals, or fertilizer sectors could heavily impact revenue, cash flows, and financial stability.
About the company
JNK India Ltd. specialises in manufacturing heating equipment for various process industries such as oil and gas refineries, petrochemicals, and fertilizers. Incorporated in 2010, the company is one of the well-recognised heater companies in India, having a market share of approximately 27% in the segment, in terms of new order booking as of FY23.
The company has successfully executed projects in India, Mexico, and Nigeria, with ongoing ventures across various Indian states and overseas locations.
JNK India's key clientele includes organizations such as Indian Oil Corporation, Tata Projects, and Rashtirya Chemicals & Fertilisers.
As of December 31, 2023, the company has provided services to 21 customers in India and 8 customers abroad.
Click on the attachment to read the full IPO report:
Also Read: JNK India IPO - Investment Rationale, Issue Details, Financials, Key Strategies, Risks: Anand Rathi
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