Kronox Lab Sciences made a strong debut on the stock market today, June 10, 2024. The share price opened at ₹164.95 on the NSE, which is 21% higher than the IPO price of ₹136. On the BSE, it started trading at ₹165, up by ₹29, or 21.32% from the IPO price.
The company’s IPO raised ₹130.15 crore and was available for subscription from June 3-5, with a price range of ₹129-136 per share. The IPO was hugely popular, being subscribed 117.25 times. Investors placed bids for 98.54 crore shares, whereas only 95.70 lakh shares were offered. Non-Institutional Investors (NII) subscribed 301.92 times, Qualified Institutional Buyers (QIB) 89.03 times, and retail investors 52.24 times.
This IPO was an offer for sale of 96 lakh shares, meaning no new shares were issued. Retail investors could buy a minimum of 110 shares, needing at least ₹14,960 to invest. The allocation of shares was 15% for NIIs, 35% for retail investors, and 50% for QIBs.
Pantomath Capital Advisors managed the IPO, and Kfin Technologies Limited acted as the registrar.
Kronox Lab Sciences, founded in 2008, makes high-purity specialty chemicals for various industries. Their products, used in pharmaceuticals, research, biotech, agrochemicals, personal care, metal refining, and animal health, are sold in India and over 20 countries. The company offers more than 185 different chemicals.
Some of its market peers include Tanfac Industries Ltd, Neogen Chemicals Ltd, Sigachi Industries Ltd, Tatva Chintan Pharma Chem Ltd, and DMCC Speciality Chemical Ltd.
Financially, Kronox Lab Sciences saw a 16.99% increase in revenue and a 21.94% rise in profit after tax from March 31, 2022, to March 31, 2023.
Most experts recommend investing in Kronox Lab Sciences for long-term benefits due to its wide range of products, strong client relationships, and stable financial performance. However, they also highlight some risks, such as exposure to foreign exchange rate changes and limited use of their manufacturing capacity, which might affect revenue growth.
The IPO’s price-to-earnings (P/E) ratio is 31.62, considered reasonable. Given its strengths and potential risks, brokerage house Swastika Investmart advises subscribing to the IPO for both short-term gains and long-term growth, with caution regarding the highlighted risks.
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