Jyoti CNC Automation IPO: From price band to GMP, all you need to know

Jyoti CNC Automation IPO: Comprehensive Information from Pricing to Grey Market Premium (GMP)

Jyoti CNC Automation specializes in the production and distribution of CNC machinery. This article provides a detailed overview of the company’s upcoming initial public offering (IPO), scheduled to open for subscription on January 9.

Jyoti CNC Automation Limited is all set to unveil its IPO on January 9, with the subscription window remaining open until January 11. Priced within the range of Rs 315 to Rs 331 per share, the IPO is anticipated to raise a total of Rs 1,000 crore. This capital infusion will be achieved through a fresh issuance of 3.02 crore shares.

Prospective investors keen on participating in this offering can expect the allocation process to occur on January 12, while the shares are scheduled to make their debut on both the Bombay Stock Exchange and the National Stock Exchange on January 16.

For retail investors, the minimum application lot size is set at 45 shares, necessitating a minimum investment of Rs 14,895.

Jyoti CNC Automation boasts an extensive product lineup, including CNC turning centres, CNC turning-milling centres, CNC vertical machining centres (VMCs), CNC horizontal machining centres (HMCs), simultaneous 3-axis CNC machining centres, simultaneous 5-axis CNC machining centres, and multi-tasking machines.

In terms of financial performance, Jyoti CNC Automation demonstrated a noteworthy turnaround, reporting a net profit of Rs 15.06 crore and revenue of Rs 952.60 crore in FY23. This marks a substantial recovery from the previous year’s loss of Rs 29.68 crore in FY22.

The EBITDA for FY23 displayed a remarkable YoY growth of 34%, reaching Rs 97.4 crore, with a margin expansion of 74 basis points, totaling 10.47%.

Market experts have observed a grey market premium (GMP) of Rs 84 for unlisted shares of Jyoti CNC Automation, suggesting an expected listing gain of 25.38% from the public issue. It’s essential to note that the GMP is contingent on market sentiments and may fluctuate accordingly.

Nevertheless, potential investors should exercise caution, taking into consideration certain associated risks with Jyoti CNC Automation. These risks include an elevated reliance on its top 10 customers, a relatively high debt-to-equity ratio of 10.17x in FY23, and comparatively lower Return on Equity (RoE) and Return on Capital Employed (RoCE) when compared to industry peers.

The Price-to-Earnings (P/E) ratio, based on diluted EPS for FY23, falls within the range of 308.82 times to 324.51 times, depending on whether you consider the upper or lower end of the price band.

The IPO is being managed by Equirus Capital Private Limited, ICICI Securities Limited, and SBI Capital Markets Limited, with Link Intime India Private Ltd serving as the registrar for the issue.

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