Incorporated in 2017, KRN Heat Exchanger and Refrigeration Limited is a manufacturer of fin and tube-type heat exchangers for heat ventilation, air conditioning and refrigeration industry. Its product portfolio includes condenser coils, evaporator units, evaporator coils, header/copper parts, fluid and steam coils and sheet metal parts.
It serves customers in India and abroad. As of FY24, it has a customer base of 115, including Daikin, Schnieder, Kirloskar, Blue Star, Climaventa and Frigel. Meanwhile, the top 10 clients contributed over 72% to overall revenue in FY24.
The company has a presence in 20 states and 2 union territories in India and exports its products to other countries, including the UAE, USA, Italy, Saudi Arabia, Norway, Czech Republic, Germany, UK, Poland, China, Canada, Ireland, France, and others. KRN Heat Exchanger’s manufacturing facility is located in Alwar, Rajasthan. As of FY24, it had a supplier base of over 510 suppliers.
Between FY22 and FY24, it saw a 25% CAGR rise in its revenue from operations and 54% in its profit. Moreover, the Indian heating, ventilation, and air conditioning (HVAC) market reported a turnover of $9.1 billion in 2023 and is expected to grow at a CAGR of 14.5% until 2029 to reach USD 20.5 billion, which could benefit the company.
Now, KRN Heat Exchanger and Refrigeration Limited is launching its initial public offer (IPO). The total IPO issue size is ₹341.9 crore, comprising entirely the fresh issue. The money raised from the fresh issue will be used to invest in its subsidiary to set up a new manufacturing facility in Rajasthan and for general corporate purposes. Its shares will be listed on the NSE and BSE.
Here are key details about the KRN Heat Exchanger and Refrigeration IPO:
| Company Established | 2017 |
|---|---|
| KRN Heat Exchanger and Refrigeration IPO Open Date | 25th September 2024 |
| KRN Heat Exchanger and Refrigeration IPO Close Date | 27th September 2024 |
| KRN Heat Exchanger and Refrigeration IPO Allotment Status | 30th September 2024 |
| Credit of Shares to Demat | 1st October 2024 |
| KRN Heat Exchanger and Refrigeration IPO Listing Date | 3rd October 2024 |
| KRN Heat Exchanger and Refrigeration IPO Face Value | ₹10 per share |
| KRN Heat Exchanger and Refrigeration IPO Lot size | 65 shares |
| KRN Heat Exchanger and Refrigeration IPO Issue Size | Approx ₹341.9 crore |
| KRN Heat Exchanger and Refrigeration IPO Listed at | BSE, NSE |
| KRN Heat Exchanger and Refrigeration IPO Price | ₹209 – ₹220 per share |
Financial snapshot
| ₹ crore | FY22 | FY23 | FY24 |
|---|---|---|---|
| Income | 156 | 247 | 308 |
| Net profit | 10.5 | 32.3 | 39 |
Strengths
- Long‐standing business relationships with leading clientele, such as since 2018 with Daikin, 2019 with Schnieder, and 2020 with Kirloskar.
- Effective quality control checks with a team consisting of 41 employees, including 25 contractual employees dedicated to quality management.
- Consistent financial performance with EBITDA margins of 10%, 19%, and 18% in FY22, FY23, and FY24, respectively.
- Established manufacturing facility located at renowned RIICO industrial areas of Neemrana, Rajasthan.
- Has ISO, IS, CE, BS, and UL-207 certifications.
Risks and threats
- The inability to maintain its current revenue growth and profit margins in the future will adversely affect its business.
- Dependent on limited customers as its largest customer accounted for 33% of its revenue from operations in FY24.
- It does not have long-term agreements with its customers, who can choose not to source their requirements from the company.
- Dependent on its top 5 suppliers, who accounted for 57% of its total purchases as of FY24. However, it does not have long-term contracts with any of its suppliers.
- Import purchases accounted for 78% of the total raw materials purchased in FY24, which exposes it to country-related risks or any change in government policies regarding imports of goods.
- Reduction or termination of export benefits and other local state government incentives might adversely affect its business.
- The cost of production is exposed to fluctuations in the prices of raw materials, particularly Aluminium Foil, Copper Foil, Galvanise sheets, Copper Tubes, Copper and Aluminum sheets, and Stainless Steel.
- Faces competition from Prijai Heat Exchangers, Spirotech Heat Exchangers, Alfa Laval India, REX Heat Exchanger, Danfoss Power Solutions India, and Kelvion India.
You can now apply for the KRN Heat Exchanger and Refrigeration IPO. Click here to apply .