Kross IPO Lists Flat On Bourses; Surges Post-listing
Despite the flat listing, we remain positive on the company and recommend investors to ‘hold’ the shares from a medium to long-term perspective, says expert
The initial public offering (IPO) of Kross listed flat on the bourses at par with its issue price of Rs 240. Post-listing the stock captured decent gains more than 8 per cent and traded above Rs 258.
During its subscription phase, the IPO got a total subscription 17.66 times. Retail category bid with a total subscription of 11.26 times, whereas qualified institutions subscribed the IPO 24.55 times.
The Rs 500 crore IPO consisted of fresh issues of up to Rs 250 crore and an offer-for-sale (OFS) worth Rs 250 crore by promoter and investor selling shareholders. The price band for the issue was fixed at Rs 228 to 240 per equity share.
Equirus Capital was the book running lead manager, while Kfin Technologies was the registrar to the offer.
Expert Note
The upcoming technological advancements in axle beam extrusion and seamless tube manufacturing are set to provide a first mover advantage, further strengthening Kross’s market position. The company is well positioned to capitalise on international opportunity as well, further enhancing the company’s geographical coverage. The rising profitability highlights the company's ability to manage costs effectively. Despite the flat listing, we remain positive on the company and recommend investors to ‘hold’ the shares from a medium to long-term perspective,” said Sagar Shetty, Research Analyst, StoxBox.
IPO Objectives
The net proceeds of Rs 250 crore from the fresh issue will be utilised towards the purchase of machinery and equipment and repayment of the outstanding borrowings.
Additionally, the funds will also be used for funding capital expenditure requirements for purchase of equipment and general corporate purposes.
Moreover, the firm will also get benefits on listing in the public market which will enhance the brand’s visibility and provide liquidity to the shareholders.
Firm’s Financials
Kross registered the revenue of Rs 621 crore in FY 23-24 against Rs 489 crore in FY 22-23. The profit after tax (PAT) increased to Rs 44.88 crore in FY 24 against Rs 30.93 crore in FY 23.
Overall, the revenue increased by 27 per cent, whereas PAT climbed 45 per cent between FY 23 and FY 24.
