As the three-day subscription period for the initial public offering (IPO) of JNK India comes to a close today, the subscription status indicates robust interest, with the book build issue fully subscribed within the first two days of bidding.
The IPO, valued at ₹649.47 crore and comprising a mix of Offer for Sale (OFS) and fresh shares, has also garnered traction in the grey market, where shares of JNK India Limited are trading at a premium of ₹24, signaling heightened investor enthusiasm. This surge in demand in the grey market is attributed to the positive reviews from reputable brokerages, boosting investor confidence in the IPO.
JNK India IPO GMP (grey market premium) stands at ₹24 today, marking a significant increase of ₹9 compared to its opening day premium of ₹15. Analysts attribute this uptick to favorable market sentiments and the favorable reviews from major brokerages, driving increased demand for JNK India IPO shares in the grey market.
By 11:12 AM on the third day of bidding, the book build issue has been subscribed 1.48 times. The retail portion of the mainboard issue has been oversubscribed 1.51 times, while the Non-Institutional Investor (NII) portion has seen a subscription of 2.4 times. However, the Qualified Institutional Buyer (QIB) segment has witnessed a subscription of only 68 percent.
In terms of reviews, Motilal Oswal has given a ‘subscribe’ recommendation to the JNK India IPO, citing the company’s strong position in the Heating Equipment segment and its strategic diversification into waste gas handling and green hydrogen.
The stock is deemed reasonably priced compared to peers in the capital goods sector. Anand Rathi and BP Equities have also recommended a ‘buy’ rating, highlighting JNK India’s established track record, diversified customer base, and promising growth prospects.
Financially, JNK India has shown impressive growth, with revenue and profit after tax (PAT) growing at a compounded annual growth rate (CAGR) of 72% and 68% respectively over FY21-23. The company’s EBITDA margin has also improved significantly, reflecting healthy return ratios with RoE/RoCE at 48% and 39% for FY23.
Several other brokerages including Arihant Capital Markets, Choice Broking, InCred Equities, Indsec Securities, Nirmal Bank, Reliance Securities, SMIFS, Sushil Finance, and Ventura Securities have also recommended a ‘buy’ rating for the IPO, underscoring confidence in JNK India’s growth prospects and financial performance.
