Kronox Lab Sciences IPO: Issue subscribed over 19 times on Day 2 so far; check GMP, other details
Kronox Lab Sciences IPO: The retail category has received 20.96 times of the total subscription and the non-institutional investor (NII) category got 36.72 times subscription. The QIB category was booked 3.20 times.
- Jun 4, 2024,
- Updated Jun 4, 2024 2:34 PM IST
The initial public offering (IPO) of Kronox Lab Sciences continued to get a strong response from investors on the second day (Day 2) of bidding process. As of 2:12 pm on Tuesday, the mainboard IPO received 19.26 times subscription, garnering bids for 12,90,41,550 shares as against 66,99,000 shares on offer.
The retail category has received 20.96 times of the total subscription and the non-institutional investor (NII) category got 36.72 times subscription. The QIB category was booked 3.20 times.
The price of the IPO has been fixed at Rs 129-136 per share. The initial share sale opened for public subscription on June 3 and will be closed on June 5. The IPO allotment will likely be finalised on June 6, while the listing will take place on June 10 on both BSE and NSE.
The Rs 130.15 crore IPO is entirely an offer-for-sale (OFS) of up to 95,70,000 shares by its promoters Joginder Singh Jaswal, Ketan Ramani and Pritesh Ramani and the company will not receive any proceeds from the issue. Kronox Lab Sciences had raised Rs 39.05 crore from six anchor investors.
Latest grey market premium
According to market observers, unlisted shares of Kronox Lab Sciences Ltd are trading Rs 65 higher in the grey market as compared with its issue price. Grey market premium or GMP means that market participants are expecting a 47.79 per cent listing gain.
Analysts largely remained positive on the back of sound fundamentals, strong moats, positioning for the growth opportunities and solid relationships with customers across the globe. However, forex fluctuations, maintenance of large portfolios, regulatory issues and geopolitical tensions are key concerns for the company.
"Kronox Lab Sciences' diverse product portfolio catering to various end-user industries, coupled with high entry and exit barriers due to stringent manufacturing processes, positions it for sustainable growth. It has established strong customer relationships and strategically located manufacturing facilities, said analysts at Swastika Investmart. They have given a 'Subscribe' rating for the issue.
"The company's financial performance, driven by its robust balance sheet, positive operating cash flows coupled with zero debt position, enables it to fund its strategic initiatives, pursue growth opportunities, create higher entry barriers and diversify into new products by setting up a new manufacturing facility," said StoxBox. "It has consistently endeavoured to diversify their portfolio of products to cater to changing customer requirements. It also has over a decade's track record of operations and has a robust balance sheet and cash flow position. The issue is valued at a P/E of 25.5 times on the upper price band based on FY24E earnings, which is fairly valued," it added with a subscribe rating.
Kronox Lab offers a wide range of over 185 products, including phosphate, sulphate, acetate, chloride, citrate, nitrates, nitrites, carbonate, EDTA derivatives, hydroxide, succinate, gluconate, and others. The company has three manufacturing facilities in Vadodara, Gujarat, close to the seaports of Mundra, Kandla, Hazira, and Nhava Sheva.
The initial public offering (IPO) of Kronox Lab Sciences continued to get a strong response from investors on the second day (Day 2) of bidding process. As of 2:12 pm on Tuesday, the mainboard IPO received 19.26 times subscription, garnering bids for 12,90,41,550 shares as against 66,99,000 shares on offer.
The retail category has received 20.96 times of the total subscription and the non-institutional investor (NII) category got 36.72 times subscription. The QIB category was booked 3.20 times.
The price of the IPO has been fixed at Rs 129-136 per share. The initial share sale opened for public subscription on June 3 and will be closed on June 5. The IPO allotment will likely be finalised on June 6, while the listing will take place on June 10 on both BSE and NSE.
The Rs 130.15 crore IPO is entirely an offer-for-sale (OFS) of up to 95,70,000 shares by its promoters Joginder Singh Jaswal, Ketan Ramani and Pritesh Ramani and the company will not receive any proceeds from the issue. Kronox Lab Sciences had raised Rs 39.05 crore from six anchor investors.
Latest grey market premium
According to market observers, unlisted shares of Kronox Lab Sciences Ltd are trading Rs 65 higher in the grey market as compared with its issue price. Grey market premium or GMP means that market participants are expecting a 47.79 per cent listing gain.
Analysts largely remained positive on the back of sound fundamentals, strong moats, positioning for the growth opportunities and solid relationships with customers across the globe. However, forex fluctuations, maintenance of large portfolios, regulatory issues and geopolitical tensions are key concerns for the company.
"Kronox Lab Sciences' diverse product portfolio catering to various end-user industries, coupled with high entry and exit barriers due to stringent manufacturing processes, positions it for sustainable growth. It has established strong customer relationships and strategically located manufacturing facilities, said analysts at Swastika Investmart. They have given a 'Subscribe' rating for the issue.
"The company's financial performance, driven by its robust balance sheet, positive operating cash flows coupled with zero debt position, enables it to fund its strategic initiatives, pursue growth opportunities, create higher entry barriers and diversify into new products by setting up a new manufacturing facility," said StoxBox. "It has consistently endeavoured to diversify their portfolio of products to cater to changing customer requirements. It also has over a decade's track record of operations and has a robust balance sheet and cash flow position. The issue is valued at a P/E of 25.5 times on the upper price band based on FY24E earnings, which is fairly valued," it added with a subscribe rating.
Kronox Lab offers a wide range of over 185 products, including phosphate, sulphate, acetate, chloride, citrate, nitrates, nitrites, carbonate, EDTA derivatives, hydroxide, succinate, gluconate, and others. The company has three manufacturing facilities in Vadodara, Gujarat, close to the seaports of Mundra, Kandla, Hazira, and Nhava Sheva.