Why did Jinkushal Industries experience a muted debut?
Click to start listening
Synopsis
Jinkushal Industries Limited's debut on the Indian stock market was less than stellar, as shares fell to the lower circuit despite an initial premium. Investors had high hopes for the IPO, but market reactions led to disappointing outcomes.
Key Takeaways
- Jinkushal Industries shares fell to a 5 percent lower circuit after a muted debut.
- Initial listing price was Rs 125, slightly above the issue price of Rs 121.
- IPO was oversubscribed 65.10 times, reflecting strong demand.
- Company plans to use IPO proceeds for working capital.
- Jinkushal operates in the construction equipment trading sector.
Mumbai, Oct 3 (NationPress) Jinkushal Industries Limited experienced a subdued debut on the Indian stock market on Friday, with its shares falling into the 5 percent lower circuit after initially opening at a slight premium.
The stock was listed at Rs 125 per share on both the BSE and NSE, representing an increase of approximately 3.3 percent from its issue price of Rs 121.
Following the listing, the stock briefly surged by 2.5 percent, reaching an intra-day peak of Rs 128 on the BSE.
However, those gains were short-lived. A wave of selling pressure at higher levels caused the stock to plummet over 7 percent from its peak, ultimately locking it at the 5 percent lower circuit of Rs 118.75 by the afternoon.
At this point, shares were down nearly 5 percent from the listing price and approximately 1.85 percent below the issue price.
This muted opening was disappointing for investors who had anticipated stronger performance.
Prior to the listing, the grey market premium (GMP) suggested a potential gain of Rs 17–21 per share, hinting at double-digit returns.
Jinkushal Industries had garnered significant investor interest during its IPO, which ran from September 25 to 29.
The issue was oversubscribed 65.10 times, with particularly strong demand from non-institutional investors.
The Qualified Institutional Buyers’ (QIBs) segment was subscribed 35.66 times, while the non-institutional investors’ portion saw an impressive 146.39 times subscription. Retail investors subscribed 47.10 times.
The IPO, valued at Rs 116.15 crore, included a fresh issue of 86 lakh shares that raised Rs 104.54 crore, along with an offer-for-sale (OFS) of 10 lakh shares worth Rs 11.61 crore.
Proceeds from the IPO will see Rs 72.68 crore allocated for working capital needs, with Rs 47.68 crore to be spent in the current financial year and the remainder by FY27.
Jinkushal Industries operates in three main verticals: exporting customized and accessorized new construction machines, exporting used and refurbished construction machines, and trading its own brand of construction machines known as ‘HexL’.
Point of View
We recognize the importance of transparency and comprehensive analysis in financial reporting. The muted debut of Jinkushal Industries Limited underscores the unpredictable nature of the stock market. Investors must remain vigilant and informed, as market dynamics can shift rapidly.
NationPress
03/10/2025
Frequently Asked Questions
What was the IPO subscription rate for Jinkushal Industries?
The IPO of Jinkushal Industries was subscribed 65.10 times, reflecting strong demand, particularly from non-institutional investors.
How did the stock perform after its listing?
After an initial rise to Rs 128, the stock faced selling pressure and fell to the 5 percent lower circuit at Rs 118.75.
What are the main business areas of Jinkushal Industries?
Jinkushal Industries operates in export trading of new and refurbished construction machines, as well as trading its own brand, 'HexL'.
What will the IPO proceeds be used for?
The proceeds will be allocated primarily for working capital needs, with Rs 72.68 crore designated for this purpose.
What was the grey market premium before the listing?
The grey market premium suggested an expected listing gain of Rs 17–21 per share, indicating positive market sentiment prior to the debut.
