Cross Limited: IPO Overview and Future Prospects
Cross Limited, a prominent manufacturer specializing in vehicle components, successfully concluded its public issue, raising an impressive Rs 500 crore. The IPO garnered substantial interest and was subscribed an astounding 17.66 times, reflecting robust investor confidence. It opened for subscriptions on September 9 and concluded on September 11, with notably high participation across all investor categories.
Subscription Details
| Investor Category | Subscription Rate |
|---|---|
| Qualified Institutional Buyers (QIBs) | 24.55 times |
| Non-Institutional Investors (NIIs) | 23.40 times |
| Retail Investors | 11.26 times |
Upcoming Listing on BSE and NSE
The shares of Cross Limited are set to be listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) on September 16. Market analysts anticipate that the shares will debut with a positive gain. Currently, in the gray market, the shares are trading at a premium of approximately Rs 24.50, equivalent to a 10.21% increase over the upper price band of Rs 240. Thus, the shares are expected to list at a price higher than Rs 264.
IPO Price Band and Structure
The IPO’s price band was established between Rs 228 and Rs 240. The overall issue comprised new shares worth Rs 250 crore, complemented by an offer for sale amounting to Rs 250 crore. The company’s promoters, Sudhir Rai and Anita Rai, have driven the company’s vision and growth, leading its successful market debut.
Products and Services Offered by Cross Limited
Previously known as Kross Manufacturers (India) Private Limited, Cross Limited specializes in manufacturing and supplying high-performance forged and precision machined parts that are critical for safety. Their products cater primarily to medium and heavy-duty commercial vehicles (M&HCV) and agricultural equipment. The extensive product portfolio includes:
- Trailer axles
- Suspensions
- Axle shafts
- Companion flanges
- Anti-roll bars
- Stabilizer bar assemblies
- Suspension linkages
- Differential spiders
- Bevel gears
- Planet carriers
- Inter-axle kits
- Rear-end spindles
- Pole wheels
- Hydraulic lift arrangements
- Power take-off shafts
- Front axle spindles
Utilization of IPO Proceeds
The funds raised from the IPO will be strategically allocated to advance Cross Limited’s operational capabilities. The company plans to utilize this capital for:
- Capital expenditure for purchasing new machinery and equipment
- Repayment of existing borrowings, which stood at Rs 128.63 crore (excluding vehicle loans) as of June 2024
- Funding working capital needs
- General corporate purposes
Conclusion
As Cross Limited prepares for its stock market debut, investors remain optimistic about its potential for growth and profitability. With solid backing from institutional investors and a strong product portfolio designed for essential sectors, Cross Limited stands poised to carve out a distinctive presence in the vehicle components market. However, as always, it is crucial for investors to conduct thorough research and consider market risks before making investment decisions.
Disclaimer: This information is intended for educational purposes only and should not be considered as investment advice. Investing in the stock market carries inherent risks, and it is advisable for investors to seek expert assistance prior to making any financial commitments.
