Cross Limited’s IPO: A Strong Investor Buzz
Cross Limited’s Initial Public Offering (IPO) has gained considerable attention among investors, with the share listing poised to take place tomorrow, September 16. The company’s public offering, which ran from September 9 to September 11, has been oversubscribed, garnering a total subscription of 16.69 times. This strong demand is reflective of investor confidence in the company’s prospects.
Subscription Details
The IPO has attracted bids for approximately 25.61 crore shares while only 1.53 crore shares were available for subscription. Breaking down the interest, the qualified institutional buyers (QIB) segment was subscribed an impressive 23.32 times. Non-institutional investors followed closely with a subscription rate of 22.20 times, and retail investors also showed considerable interest, subscribing 10.53 times. The overall subscription rate of 16.69 times indicates a robust response from all investor categories.
Grey Market Performance
As of September 15, the grey market has shown positive indications for Cross Limited’s IPO, with current trading reflecting a premium of Rs 24.50. This suggests that the shares may debut at around Rs 264.50, providing investors with an anticipated profit of about 10.21% at the time of listing. However, investors are reminded that grey market conditions can fluctuate rapidly, with minimum and maximum grey market premiums (GMP) reported at ₹0 and ₹50, respectively.
Company Overview
Based in Jharkhand, Cross Limited specializes in manufacturing forged and precision machined components that are safety-critical, primarily for the medium and heavy commercial vehicle (M&HCV) and agricultural equipment sectors. The company, owned by the Rai family, earns about 89% of its revenue from the M&HCV segment, with the remaining 9% from the farm equipment division. Cross Limited is in competition with established firms such as Automotive Axles, GNA Axles, Ramkrishna Forgings, Jamna Auto Industries, and Talbros Automotive Components.
Financial Performance
Cross Limited has showcased strong financial health over recent years. For the fiscal year 2024 (FY24), the company reported a net profit of Rs 44.9 crore, showing a 45.1% increase compared to the previous year. Revenue also saw a notable rise, growing 27% year-over-year to reach Rs 620.3 crore. Furthermore, the company’s EBITDA climbed by 40.4% to Rs 80.8 crore for the year ending March 2024, with margins improving by 120 basis points to 13% compared to FY23.
Conclusion
With a strong IPO subscription rate, positive grey market performance, and solid financial results, Cross Limited is positioned to make a significant impact upon listing. Investors are encouraged to keep up with the latest news as they assess their engagement with this promising IPO.
(Disclaimer: The insights provided in this article reflect the opinions of financial experts and brokerage firms. For personalized advice, individuals should consult certified financial advisors before making any investment decisions.)
