Inox India Ltd, a top supplier of cryogenic equipment in the country, recently entered the stock market through an Initial Public Offering (IPO). The response from investors was remarkable and resulted in the company’s shares being listed on both BSE and NSE.
On the listing day, there was a considerable premium to the IPO price, indicating the market’s confidence in the company. This article will delve into Inox India’s IPO highlights, listing performance, key financials, and market prospects for its cryogenic equipment.
Inox India IPO: Listing Highlights
In the initial public offering, Inox India was listed on both the BSE and NSE on December 21. Shares sold at IPO were $660 per share, but they ended up at $934, representing about 41.5% of the IPO price. The share price closed at $939.90 on the BSE, 42.41% higher. Market confidence in Inox India and its growth prospects is evident in this strong debut.
Inox India’s Financial Performance
In the past few years, Inox India has shown remarkable financial performance. Throughout FY21-23, the company experienced a compound annual growth rate (CAGR) of 27.5%, highlighting its impressive revenue growth. This was mainly driven by export sales, which achieved a faster CAGR of 46.7%, although they made up a smaller portion of total sales. The company maintained consistent gross profit margins ranging from 53-55%, as well as EBITDA margins between 21-23% and PAT margins between 16-17%.
Inox India’s Order Book and Peers
Inox India has three divisions: Industrial Gas, LNG, and Cryo Scientific. The company’s order book is evenly spread among these divisions, with Cryo Scientific contributing 22% of revenues in FY23. Industrial gases make up the largest portion of the order book at 53%, followed by LNG at 25%.
In the domestic market, Inox India has no listed competitors. However, on a global level, companies such as CIMC Enric Holdings Ltd. and Chart Industries Inc. have similar product profiles and are considered Inox India’s closest competitors.
Outlook for Inox India IPO
The Cryogenic equipment market is projected to grow at a CAGR of 6.9% from 2023 to 2028, reaching $16.6 billion. As a prominent supplier and exporter of cryogenic equipment and solutions, Inox India is in a favorable position to capitalize on this increasing demand.
It currently holds a place among the top 10 global manufacturers of cryogenic equipment in terms of revenue for 2022. Backed by robust financial performance, diverse product range, and expanding market opportunities, Inox India has the potential for sustained value generation over the long run.
- Strengths of Inox India IPO: In addition to its strong reputation as a leading exporter and supplier of cryogenic equipment, Inox India IPO also boasts a large inventory of specialized equipment and a diverse customer base.
- Risks for Inox India IPO: Although Inox India IPO has strong growth prospects, there are certain risks associated with it. About 56% of the company’s revenue comes from its top ten clients, which poses a concentration risk. Further, the company’s export sales make it susceptible to currency fluctuations and changes in raw material prices. Before making investment decisions, investors should carefully consider these risks.
Inox India IPO Promoters and Promoter Group
A group of four promoters is responsible for the Inox India IPO: Pavan Kumar Jain, Nayantara Jain, Siddharth Jain, and Ishita Jain. The promoters’ strong ownership reflects their confidence in the company’s growth prospects and commitment to its success. Together, they hold 91.51% of the company’s issued, subscribed, and paid-up equity shares.
Inox India IPO: Product Details and Market Cap
In total, Inox India operates in three different areas: Industrial Gas, LNG, and Cryo Scientific. The first division specializes in creating and providing cryogenic containers and systems for the safe and efficient distribution, storage, and transportation of industrial gases.
The second division focuses on producing both standard and customized equipment for the storage, distribution, and transportation of LNG. Lastly, the third division offers complete solutions for advanced cryogenic research and equipment tailored to specific needs.
As a result of this success across all divisions, Inox India’s recently launched Initial Public Offering resulted in a favourable stock market response. Specifically, their release on BSE garnered a market capitalization of ₹8,530.86 crore while on NSE it reached ₹8,477.31 crore.
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