Inox India's Rs 1,459-Crore IPO Opens For Subscription: Should You Invest Or Not?
The issue is entirely an offer for sale of up to 2.21 crore shares by its existing shareholders and promoters.
Cryogenic tankmaker Inox India Ltd.'s three-day initial public offering is scheduled to open on Dec. 14. The company has set a price band of Rs 627–660 per share.
The issue is entirely an offer for sale of up to 2.21 crore shares by its existing shareholders and promoters, with the company aiming to raise Rs 1,459 crore.
Siddharth Jain, Pavan Kumar Jain, Nayantara Jain, Ishita Jain, and Manju Jain are offering shares in the OFS. As the maiden share sale is an OFS issue entirely, the company will not receive any funds from the offer and the proceeds will go to selling shareholders.
"Inox India is well-positioned to capture this global market growth with in-house technology as well as LNG product range that includes the entire value chain," said Anand Rathi in a note. The company was the largest exporter of cryogenic tanks from India, in terms of revenue, in fiscal 2023.
At the upper price band, the company is valued at a price-to-earnings ratio of 39.2 times, with a market cap of Rs 5,990 crore after issue of equity shares and return on net worth of 27.79% in FY23.
"On the valuation front, we believe that the company is fairly priced. Thus, we recommend an 'Subscribe–Long Term' rating to the IPO," said the brokerage.
Reliance Securities expects that Inox's investment in R&D and product development, four patent applications, expansion of the new facility in Savli, and strong manufacturing capabilities in large turnkey projects will drive the earnings momentum over the next few years. They have also recommended a 'Subscribe' to the issue.
"On the upper price band, the issue is valued at a P/E of 39.2 times based on FY23 earnings, which we feel is fairly valued. We, therefore, recommend Subscribe rating for the issue," said StoxBox.
