Kaynes Tech lists at 33% premium over issue price, commands m-cap of Rs 4,500 crore

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Kaynes Technologies made a stellar debut in the market on Tuesday as the stock got listed at Rs 775 on BSE, a 32.03 per cent premium over its issue price of Rs 587. The company commanded a market capitalization of Rs 4,506.04 crore.

The stock opened at Rs 778, up 32.54 per cent, on the NSE.

The stock was earlier commanding a gray market premium (GMP) of around Rs 150 over the issue price of Rs 587, which suggests a listing pop of around 26 per cent for the stock.

This Rs 857.82 crore IPO, which ran from November 10 to November 14, received 34.22 times the bids. The quota reserved for qualified institutional buyers was subscribed 98.47 times. The portion reserved for non-institutional investors got bids of 21.21 times. The employee portion was subscribed 11.89 times while the retail portion was subscribed 4.09 times. The issue price has been kept at Rs 587 per share.

At the issue price, the PE of Kaynes Technologies stood at 69 times FY22 EPS, in line with its listed peers such as Amber Enterprises and Sira SGS Technology.

Kaynes Technology is an end-to-end and IoT solution enabled integrated electronics manufacturing player. It was one of the first companies to offer design-based electronics manufacturing to original equipment manufacturers (OEMs). Kayans had an order book of Rs 2,266.26 crore as on June 30.

In the listing space, Kaynes Technology competes with Dixon Technologies India, Sirama SGS Technology and Ember Enterprises India. Kaynes Technology has eight manufacturing facilities in India strategically located in the states of Karnataka, Haryana, Himachal Pradesh, Tamil Nadu and Uttarakhand.

Kayans had a combined potential to collect over ₹1,500 million on an annualized basis by June 30, 2022.

In its bull case scenario, Ventura Securities assumes FY25 revenue of Cayenne at Rs 1,800 crore (FY22-25 CAGR of 36.6 per cent), net margin at 9 per cent and FY25 PE of 32 times, which leaves a target of Rs 892 per share . Share, which suggests a potential upside of 51.9 per cent from the issue price.

In its bear case, it suggests FY25 revenue at Rs 1,300 crore (FY22-25 CAGR of 22.6 per cent), net margin at 8 per cent and FY25 PE at 27 times, suggesting a target of Rs 483 per share. Potential downside of 17.7% from the issue price.

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