Ken Enterprises Ltd
Ken Enterprises Limited, a prominent player in the textile manufacturing sector, has announced its Initial Public Offering (IPO) scheduled to open on February 5, 2025. This article provides a comprehensive overview of the company’s IPO details, financials, strengths, risks, and other pertinent information for potential investors.
Company Overview
Established in 1998, Ken Enterprises Limited specializes in the production of greige and finished fabrics catering to various applications, including apparel, home textiles, and industrial uses. The company operates on an asset-light model, leveraging partnerships with third-party manufacturers, primarily located in Ichalkaranji, Maharashtra, a significant hub for fabric weaving. Ken Enterprises boasts a diverse product range and serves both domestic and international markets, supplying high-quality textiles to more than 10 countries. Notably, the company is an approved vendor for renowned global brands such as ZARA (Inditex Group), Target, and Primark.
IPO Timeline and Key Dates
- Issue Opening Date: February 5, 2025
- Issue Closing Date: February 7, 2025
- Allotment Finalization: February 10, 2025
- Refund Initiation: February 11, 2025
- Shares Credited to Demat Accounts: February 11, 2025
- Listing Date: February 12, 2025
Price Band and Lot Size
- Issue Price: ₹94 per equity share
- Lot Size: 1,200 shares
- Minimum Investment: ₹112,800
Issue Size and Structure
The IPO comprises a total of 88,99,200 equity shares, aggregating to ₹83.65 crores. This includes a fresh issue of 61,99,200 equity shares amounting to ₹58.28 crores and an offer for sale (OFS) of 27,00,000 equity shares by the promoters, totaling ₹25.37 crores.
Objectives of the Issue
The net proceeds from the IPO are intended to be utilized for the following purposes:
- Unidentified acquisitions in India and abroad
- Purchase of new machinery
- Capital expenditure for the renovation of manufacturing facilities
- Meeting working capital requirements
- General corporate purposes
Financial Highlights
Over the past three fiscal years, Ken Enterprises has demonstrated consistent growth:
| Fiscal Year | Revenue (₹ Cr) | Net Profit (₹ Cr) | Net Worth (₹ Cr) | Debt (₹ Cr) | RoE (%) |
|---|---|---|---|---|---|
| FY-22 | 354.8 | 2.36 | 31.98 | 41.01 | 7.38 |
| FY-23 | 363.96 | 3.95 | 35.92 | 49.46 | 11.00 |
| FY-24 | 402.21 | 8.93 | 44.85 | 47.85 | 19.91 |
Data Source: Value Research Online
Strengths
- Asset-Light Business Model: Utilizing third-party manufacturing partnerships allows for scalable operations without significant capital expenditure.
- Established Client Relationships: Long-standing associations with global brands ensure repeat business and revenue stability.
- Diverse Product Portfolio: A wide range of fabric offerings caters to various market segments, enhancing market reach.
- In-House Product Development: Expertise in product innovation supports the development of new and customized fabric solutions.
- Efficient Delivery Mechanism: Quick development cycles and efficient delivery systems ensure high customer satisfaction.
Risks
- Dependence on Third-Party Manufacturers: Reliance on external partners may expose the company to operational risks beyond its direct control.
- Historical Negative Cash Flows: Past negative cash flows could impact future financial stability and growth prospects.
- Potential Manufacturing Disruptions: Any disruptions in manufacturing processes may adversely affect operations and financial performance.
- Absence of Long-Term Contracts: The lack of long-term agreements with customers may lead to revenue volatility.
- Regulatory Compliance: Operations are subject to environmental and safety regulations, with associated compliance risks.
IPO Anchor Investors Details
As of now, specific details regarding anchor investors have not been disclosed. Investors are advised to monitor official company communications for updates.
IPO Promoter Holding
The promoter holding details are as follows:
| Promoter Name | Number of Shares Offered for Sale |
|---|---|
| Nikunj Hariprasad Bagdiya | 13,50,000 |
| Bina Hariprasad Bagdiya | 13,50,000 |
Data Source: Business Standard
IPO Grey Market Premium (GMP)
As of the latest available information, the Grey Market Premium for Ken Enterprises IPO is ₹0, indicating that shares are trading at their issue price with no premium or discount in the grey market.
Final Thoughts
Ken Enterprises Limited’s upcoming IPO presents an opportunity for investors to participate in a company with a solid track record in the textile industry. The company’s asset-light model, established client relationships, and diverse product offerings are notable strengths. However, potential investors should carefully consider the associated risks, including dependence on third