Jinkushal Industries Share Price Opens Flat on Debut
Jinkushal Industries Ltd. made an underwhelming debut on the stock market on Friday, listing flat over its IPO price. The share price opened at Rs 125 on the NSE and BSE, compared to the issue price of Rs 121.
The initial public offer was subscribed 65.01 times on the last day of share sale on Monday, helped by strong participation from non-institutional buyers. The Rs 116.15 crore IPO received bids for 43,75,69,560 shares against 67,21,048 shares on offer, as per BSE data.
Subscription Details
The quota for Qualified Institutional Buyers (QIBs) was subscribed 35.66 times. The non-institutional investors part attracted 146.39 times subscription, and the Retail Individual Investors (RIIs) portion got subscribed 47.10 times.
The Jinkushal Industries IPO was a book-built issue of Rs 116.15 crore. It comprised a fresh issue of 86 lakh shares, raising Rs 104.54 crore, and an offer-for-sale component of 10 lakh shares, valued at Rs 11.61 crore.
Use of Proceeds
From the proceeds of the IPO, Jinkushal Industries will use up to Rs 72.68 crore for its working capital requirement. The company will use Rs 47.68 crore within the current financial year, and it will engage the rest of the proceeds by financial year 2027.
For more information on IPO proceeds and how companies use them, check out our detailed guide.
Business Overview
Jinkushal Industries exports new, customised, used, and refurbished construction machines in global markets. It’s the largest non-original equipment manufacturer in construction machinery exports with a 6.9% market share, according to a CareEdge report.
The company operates in three primary business verticals — export trading of customised, modified and accessorised new construction machines; export trading of used/refurbished construction machines; and export trading of our own brand ‘HexL’ construction machines.
Jinkushal Industries also earns a small portion of revenue from logistics warehouse leasing and renting of construction machines.
Export Markets
As per information on the draft red herring prospectus, the company has exported construction machines to over 30 countries, including the United Arab Emirates, Mexico, the Netherlands, Belgium, South Africa, Australia, and the UK.
Jinkushal Industries is recognised as a three-star export house by the Directorate General of Foreign Trade. For more information on export houses and their benefits, check out our detailed guide.
Investor Takeaway
The flat listing of Jinkushal Industries may have been a disappointment for some investors, but it’s essential to look at the company’s long-term prospects and growth potential. With a strong export market and a diverse range of products, Jinkushal Industries is well-positioned to take advantage of the growing demand for construction machines.
However, investors should also be aware of the risks associated with the company’s business, including intense competition and fluctuations in global demand. For more information on construction machinery industry trends and outlook, check out our detailed analysis.
Conclusion
In conclusion, Jinkushal Industries’ flat listing may not have been the most exciting debut, but the company’s strong fundamentals and growth prospects make it an attractive investment opportunity. Investors should keep a close eye on the company’s progress and be prepared to take advantage of any potential upside.
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