The much-anticipated Initial Public Offering (IPO) of KRN Heat Exchanger kicked off on 25th September 2024, and it has already created a stir in the market. The IPO, open for subscription until 27th September, has witnessed an impressive rise in the Grey Market Premium (GMP), crossing 100% on its first day. With a total IPO size of Rs 341.5 crore, the company is offering fresh equity shares, setting a price band between Rs 209 and Rs 220 per share.
Given the promising start and expert opinions from leading brokerage houses, many investors are wondering whether they should subscribe to this IPO. Let’s explore the key factors driving this IPO and why it’s becoming the talk of the town.
Strong Demand in the Grey Market: GMP Hits 109%
One of the standout features of the KRN Heat Exchanger IPO is the soaring Grey Market Premium (GMP). As of today, the unlisted stock is trading at a premium of Rs 240, which represents a whopping 109% increase over the upper price band of Rs 220 per share.
This rapid rise in GMP indicates that the stock could deliver significant returns on the day of listing, making it an attractive option for short-term investors looking to make a quick profit. The allotment of shares is expected to be finalized on 30th September, with the stock set to debut on the BSE and NSE on 3rd October.
Affordable Investment Entry: Lot Size and Pricing
For those interested in participating in the IPO, the lot size is set at 65 shares, meaning that investors need to make a minimum investment of Rs 14,300. Given the positive sentiment around the GMP, many retail investors are likely to participate, aiming for listing day gains.
Brokerage Houses Recommend Subscription: Here’s Why
Several well-known brokerage houses have given positive recommendations for the KRN Heat Exchanger IPO, citing both short-term gains and long-term growth potential.
Reliance Securities has suggested subscribing to the IPO due to KRN’s strong position in the heat exchanger industry, particularly in the fin and tube-type category for HVAC and refrigeration systems. The company’s innovative use of non-ferrous metals like copper and aluminum, along with partnerships with industry leaders like Daikin and Blue Star, has positioned KRN as a key player in the sector.
Furthermore, Reliance Securities highlights that KRN’s operational efficiency and strategic expansion into global markets make it a compelling investment opportunity. The company, led by a first-generation entrepreneur with nearly two decades of experience, has successfully diversified its product portfolio and built lasting relationships with major clients, which has led to consistent revenue growth.
Swastika Investmart has also advised long-term investors to subscribe, citing KRN’s leadership in delivering international quality products and the potential for robust growth in the coming years. While there are no direct listed competitors for comparison, Swastika believes that the company’s strong fundamentals and reasonable IPO valuation make it a solid choice for those looking for both listing day profits and long-term investment gains.
Should You Subscribe?
With the KRN Heat Exchanger IPO’s high GMP and strong endorsements from brokerage houses, it’s clear that this IPO has captured the market’s attention. Investors looking for short-term listing gains are likely to find this IPO appealing, while those with a long-term perspective may also see value in KRN’s strategic positioning, innovation, and industry leadership.
Given the company’s consistent growth in revenue and profitability, as well as the positive outlook from experts, subscribing to the KRN Heat Exchanger IPO could prove to be a wise investment decision.
