Inox India Ltd IPO

Many people may not be familiar with cryogenic tank manufacturer, Inox India Ltd. However it is among the largest cryogenic equipment manufacturers and exporters. It is planning to launch its IPO and has filed its Draft Red Herring Prospectus with SEBI. Axis Capital and ICICI Securities are the book-running lead managers of the issue. 

Being a leading player in its segment, the upcoming IPO of Inox India Ltd is expected to attract the interest of many investors. If you are looking forward to investing in a similar kind of sector, you can consider investing in the Inox India Ltd IPO. Read to get more insights about the same.

Also Read: How does an IPO work?

About the Company

Inox India Ltd is a Gujarat-based subsidiary of the Inox Group. It has been engaged in the business of manufacturing and selling cryogenic equipment for more than three decades. It is the largest exporter of cryogenic tanks from India in FY22. It is among the leading manufacturers of cryogenic equipment globally providing solutions across engineering, manufacturing, designing and installation of systems.

The company’s offerings include beverage kegs, standard cryogenic tanks, large turnkey projects used in industries like green hydrogen, energy, chemicals and fertilisers, steel, healthcare, aviation, aerospace and more. In addition, Inox India Limited produces cryogenic tanks and equipment for global research projects.

IPO Details and Objectives

Inox India Ltd has filed its Draft Red Herring Prospectus (DRHP) with SEBI. The proposed IPO is purely an offer-for-sale comprising 2,21,10,955 equity shares where four promoters and six shareholders of the company are diluting their proportion of stakes. 

The company expects to enhance its visibility, and brand image through this offer. It also aims to achieve all other benefits of listing in a stock exchange. The company will not be receiving any such proceeds. After bearing all offer-related costs, the net proceeds will go to the selling shareholders and promoters of the company. 

Additional Read: Lohia Corp Ltd IPO

Company Financials 

Here are some essential financial details of Inox India over the previous three financial years:

Particulars*	For the Financial Year Ending on
	March 31, 2023	March 31, 2022	March 31, 2021
Total Assets	11,483.64	8,967.53	6,872.00
Total Liabilities	5,988.89	3,944.69	3,156.86
Total Expenses	7,791.50	6,295.06	4,779.27
Total Revenue	9,841.99	8,037.13	6,089.92
Profit/Loss After Tax	1,527.14	1,304.98	961.07
EBITDA	2,226.51	1,886.31	1,496.98
EPS (Basic and Diluted)	16.83	14.38	10.59

*All figures are in Rs. Millions except EPS

Strengths of the Company

Inox India Ltd has numerous strengths which sets it apart from other market players. Here are some of the biggest competitive strengths of this company.

• Inox India is one of the largest manufacturers of cryogenic equipment and among the largest cryogenic tank manufacturers in the world. Its in-house teams are trained to maintain international norms and standards for manufacturing and various services.
• The company has a massive portfolio of cryogenic equipment which are used across diverse industries such as healthcare, energy, pharmaceuticals, fertilizers, aviation, aerospace and more.
• Its core focus is on product development and engineering. The company’s in-house engineering teams design cryogenic containers that comply with ISO standards, LNG fuel stations, beverage kegs and cryogenic biological storage.
• Inox India Ltd has organically developed healthy and stable financials over the years. Its consolidated total income has grown at an exponential rate of 27.13% CAGR from FY 21 to FY 23.

Also Read: How Can You Analyse An IPO?

Risks Involved 

Here are some of the risk factors associated with the business activities of Inox India Ltd:

• Its business is entirely dependent on manufacturing. In the event of any mechanical failure, breakdown, industrial accident or natural disaster, the company’s manufacturing process might get halted directly affecting its profitability.
• Its revenue inflows are dependent on a limited number of customers, any adverse situation or delay from the debtor’s end might affect the company’s operations and profitability.
• The manufacturing facilities of Inox India Limited are present in Gujarat and the union territory of Dadra and Nagar Haveli. Therefore, geographic risks such as local regulations, labour unrest, terrorist attacks or any disasters either natural or man-made, can have a significant impact on its daily operations.

Conclusion

Before taking a final call on whether to invest in this company or not, carefully check all the risk factors, competitive strengths and financial summary. Furthermore, it is always recommended to understand the company’s line of business, revenue streams and several other aspects. Consider going through the DRHP before making any investments.

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