On Wednesday, June 5, the Kronox Lab Sciences IPO will close. The IPO price range is set between ₹129 and ₹136 per share, each with a face value of ₹10. On Friday, May 31, anchor investors contributed ₹39.04 crore to the IPO.
IPO Allocation
- Non-Institutional Investors (NII): 15%
- Retail Investors: 35%
- Qualified Institutional Buyers (QIB): 50%
About Kronox Lab Sciences
Founded in 2008, Kronox Lab Sciences Limited produces high-purity specialty fine chemicals for various markets, including APIs, pharmaceuticals, research, nutraceuticals, agrochemicals, metal refineries, personal care, and animal health products.
Listed Competitors
- Tanfac Industries Ltd: P/E of 39.15
- Neogen Chemicals Ltd: P/E of 77.55
- Sigachi Industries Ltd: P/E of 46.64
- Tatva Chintan Pharma Chem Ltd: P/E of 57.57
- DMCC Speciality Chemical Ltd: P/E of 116.57
Kronox Lab Sciences IPO Review
Hensex Securities: Kronox Lab Science Ltd. makes high-purity specialty chemicals for various industries and exports to over 20 countries. From 2021 to 2023, the company’s revenue grew at a CAGR of 23.70%, from ₹62.46 crore to ₹95.58 crore. EBITDA grew at a CAGR of 21.90%, from ₹14.80 crore to ₹21.99 crore, and PAT increased at a CAGR of 30.68%, from ₹9.73 crore to ₹16.62 crore.
The company’s revenue from exports accounted for 25.07%, 26.41%, 25.39%, 23.46%, and 20.56% of its operations for the respective periods.
Investment Perspective: Kronox Lab Sciences operates in the specialized fine chemicals sector and is positioned for long-term growth due to its diverse product range, strict production processes, well-located facilities, and strong client relationships. The company has a solid financial performance and is debt-free.
Considerations
- Foreign Exchange Rates: Kronox Lab Sciences is affected by global market fluctuations.
- Capacity Utilization: The company currently uses a smaller portion of its production capacity, potentially limiting income growth.
Despite these risks, the IPO’s P/E valuation of 31.62x is reasonable. Considering the company’s strengths and potential for growth, a subscription rating is recommended for potential listing gains and long-term growth, while being mindful of the risks.
IPO Details
The IPO consists solely of an offer-for-sale (OFS) of 95.7 lakh equity shares. The proceeds will go to the selling shareholders, including the promoters Jogindersingh Jaswal, Ketan Ramani, and Pritesh Ramani, each selling 31.9 lakh shares.
- Lead Manager: Pantomath Capital Advisors Pvt Ltd
- Registrar: Kfin Technologies Limited
Kronox Lab Sciences IPO GMP Today
The grey market premium (GMP) for Kronox Lab IPO today is +81, meaning shares are trading at a premium of ₹81 in the grey market. Considering the upper end of the IPO price band, the expected listing price is ₹217 per share, 59.56% higher than the IPO price of ₹136. The GMP indicates investors’ willingness to pay more than the issue price.
Disclaimer: The views and investment tips expressed by investment experts on Sharepriceindia.com are their own and not those of the website or its management. Sharepriceindia.com advises users to check with certified experts before taking any investment decisions.
