IKIO Lighting Limited IPO
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i. IKIO Lighting is an Indian manufacturer of light emitting diode (“LED”) lighting solutions. They are focused on sustainability and providing low energy LED products to help India meet its sustainability goals. They are primarily an original design manufacturer (“ODM”) and design, develop, manufacture and supply products to customers who then further distribute these products under their own brands.
ii. The company also work with their customers to develop, manufacture and supply products that are designed by their customers.
iii. Their products are categorised as
(i) LED lighting;
(ii) refrigeration lights;
(iii) ABS (acrylonitrile butadiene styrene) piping; and
(iv) other products.
iv. The company provides lighting solutions (lights, drivers and controls) to commercial refrigeration equipment suppliers under their refrigeration light segment. They also manufacture an alternative to polyvinyl chloride (“PVC”) piping called ABS piping that is primarily used by their US customers for plumbing applications in the recreational vehicles (“RVs”) that they fit out.
v. In addition, they manufacture and assemble other products including fan regulators that are designed by their clients; light strips, moulding, and other components and spares. Their equipment and systems are used in various industries and products, including residential, industrial and commercial lighting.
Competitive Strengths
i. Poised to capture growth of LED market
ii. Diverse product basket with focus on high-margin areas
iii. Long-term relationships with leading industry customers
Objects of the IKIO Lighting Limited IPO:
The Company proposes to utilize the Net Proceeds towards funding the following objects:
i. Repayment/ prepayment, in full or part, of certain borrowings availed by the Company and its Subsidiaries on a consolidated basis
ii. Investment in the wholly owned Subsidiary, IKIO Solutions Private Limited, for setting up a new facility at Noida, Uttar Pradesh
iii. General corporate purposes
IKIO Lighting Limited IPO Details:
| Open Date: | Jun 06 2023 |
| Close Date: | Jun 08 2023 |
| Total Shares: | 21280702 |
| Face Value: | ₹ 10 Per Equity Share |
| Issue Type: | Book Built Issue IPO |
| Issue Size: | 606 Cr. |
| Lot Size: | 52 Shares |
| Issue Price: | ₹ 270-285 Per Equity Share |
| Listing At: | NSE,BSE |
| Listing Date: | Jun 16 2023 |
Promoters And Management:
Hardeep Singh is the Chairman and Managing Director of the Company. He is the founder and one of the Promoter of the Company He has been associated with the Company since its inception. He has completed his Higher Secondary Education and has more than two decades of experience in the manufacturing of of television kits, electronic components and LED lighting. He has been honoured by Philips with "Game Changer" Award for LED Lighting Production. He oversees the overall functions of the Company and is responsible for overseeing the strategic growth initiatives and expansion plans.
Surmeet Kaur is the Whole-time Director on the Board and one of the Promoters of the Company. She holds a bachelors’ degree in Arts (Honours) from University of Delhi. She has been associated with the Company since inception and is responsible for management of Human Resources.
Sanjeet Singh is the Whole-time Director on the Board. He holds a bachelor’s degree in Commerce from University of Delhi. He has been associated with the Company since February 1, 2019. He oversees the overall operations of the Company.
Financials of IKIO Lighting Limited IPO:
A) Balance Sheet
B) P&L Statement
C) Cash Flow Statement
| Particulars (In Cr) | 2020 | 2021 | 2022 |
| Equity Share Capital | ₹0.05 | ₹0.05 | ₹25.00 |
| Reserves | ₹36.00 | ₹63.00 | ₹84.00 |
| Borrowings | ₹47.00 | ₹69.00 | ₹107.00 |
| Trade Payables | ₹32.00 | ₹23.00 | ₹23.00 |
| Other Liability | ₹30.00 | ₹18.95 | ₹26.00 |
| Total Liability | ₹145.05 | ₹174.00 | ₹265.00 |
| Fixed Assets Block | ₹22.00 | ₹22.00 | ₹25.00 |
| CWIP | ₹0.50 | ₹4.00 | ₹9.00 |
| Investments | ₹0.00 | ₹0.00 | ₹0.00 |
| Other Assets | ₹34.50 | ₹40.00 | ₹42.00 |
| Total Non-Current Assets | ₹22.50 | ₹26.00 | ₹34.00 |
| Receivables | ₹30.00 | ₹33.00 | ₹56.00 |
| Inventory | ₹37.00 | ₹58.00 | ₹110.00 |
| Cash and Cash Balance | ₹8.00 | ₹4.00 | ₹3.00 |
| Other Assets | ₹13.00 | ₹13.00 | ₹19.00 |
| Total Current Assets | ₹88.00 | ₹108.00 | ₹188.00 |
| Total Assets | ₹145.05 | ₹174.00 | ₹265.00 |
| Particulars (In Cr) | 2020 | 2021 | 2022 |
| Sales | ₹220.00 | ₹213.00 | ₹332.00 |
| Sales Growth | 0.00% | -3.18% | 55.87% |
| COGS | ₹139.00 | ₹120.00 | ₹193.00 |
| COGS % of Sales | 63.18% | 56.34% | 58.13% |
| Gross Profit | ₹81.00 | ₹93.00 | ₹139.00 |
| Gross Margins | 36.82% | 43.66% | 41.87% |
| Employee Benefit & Other Expenses | ₹44.00 | ₹45.00 | ₹62.00 |
| S&G Sales % | 20.00% | 21.13% | 18.67% |
| EBITDA | ₹37.00 | ₹48.00 | ₹77.00 |
| EBITDA Margins | 16.82% | 22.54% | 23.19% |
| Interest Cost | ₹4.00 | ₹4.00 | ₹5.00 |
| Interest %of Sales | 1.82% | 1.88% | 1.51% |
| Depreciation | ₹4.00 | ₹5.00 | ₹5.00 |
| Dep %of Sales | 1.82% | 2.35% | 1.51% |
| EBIT Margins | 15.00% | 20.19% | 21.69% |
| Other Income | 1 | 1 | 2 |
| Earnings Before Tax | ₹30.00 | ₹40.00 | ₹69.00 |
| EBT % Sales | 13.64% | 18.78% | 20.78% |
| Tax | ₹9.00 | ₹11.00 | ₹19.00 |
| Effective Tax Rate | 30.00% | 27.50% | 27.54% |
| PAT | ₹21.00 | ₹29.00 | ₹50.00 |
| NPM | 9.55% | 13.62% | 15.06% |
| No. of Equity Shares | 2.5 | 2.5 | 2.5 |
| Earning Per Share | ₹8.40 | ₹11.60 | ₹20.00 |
| EPS Growth % | 0.00% | 38.10% | 72.41% |
| Dividend Per Share | ₹0.00 | ₹0.00 | ₹0.00 |
| Dividend Payout Ratio | 0.00% | 0.00% | 0.00% |
| Retained Earnings | 100.00% | 100.00% | 100.00% |
| Particulars (In Cr) | 2020 | 2021 | 2022 |
| Cash Flow from Operating | 23.00 | -9.00 | -15.00 |
| Cash Flow from Investing | 3.00 | -6.00 | -9.00 |
| Cash Flow from Financing | -20.00 | 10.00 | -24.00 |
| Net Cash Flow | ₹8.00 | ₹3.00 | ₹2.00 |
Comparison With Peers:
| Name of the Companies | Revenue | Profit | EPS | P/E | CMP | MCap |
| IKIO Lighting | 437 | 69 | 8.93 | 31.92 | 285 | 2202.48 |
| Dixon Technologies | 12,192 | 255 | 42.9 | 91.1 | 3,907 | 23,271 |
| Amber Enterprises | 6,927 | 164 | 46.6 | 46.4 | 2,168 | 7,306 |
| Syrma SGS Tech | 2,048 | 123 | 6.75 | 57.8 | 390 | 6,889 |
| Elin Electronics | 1,075 | 27 | 5.4 | 24.9 | 135 | 670 |
Recommendation on IKIO Lighting Limited IPO:
Review and Recommendation of IKIO Lighting by IZ team is 6/10
1. Business Overview: IKIO Lighting Limited is an Indian company that designs, develops, manufactures, and supplies LED lighting solutions to customers who distribute these products under their own brands.
2. Product Details: The company offers a range of LED lighting products, including lights, fittings, fixtures, accessories, and components. They also provide lighting solutions for commercial refrigeration equipment and manufacture ABS piping as an alternative to PVC piping.
3. Manufacturing: IKIO Lighting has four manufacturing facilities located in Uttarakhand and Noida. They have integrated their major manufacturing processes and can produce most mechanical components in-house.
4. Research and Development: The company has a dedicated R&D department that focuses on product design and development. The team consists of skilled professionals with degrees in electronics, communication, mechanical engineering, and relevant diplomas.
5. Financial Performance: Over the years, IKIO Lighting has experienced increasing revenue, reaching ₹328.63 crores as of December 31, 2022. The company's profit after tax has also shown a positive trend, reaching ₹51.35 crores during the same period.
6. Customers: The company serves a diverse customer base, with a strong presence in the United States. They manufacture a wide range of products for their largest customer, Signify (Philips) in India, and are exploring opportunities to supply LED home lighting products internationally.
7. Management: IKIO Lighting is led by an experienced management team, with Hardeep Singh as the Promoter, Managing Director, and Chairperson.
8. Valuation: The company's earnings per share (EPS) for FY23 indicate a relatively undervalued stock with a price-to-earnings (P/E) ratio of 44x compared to industry peers. Dixon has a P/E of 90, ELIN has a P/E of 31, Amber has a P/E of 45, and Syrma has a P/E of 58
Lead Manager of IKIO Lighting Limited IPO:
Registrar of IKIO Lighting Limited IPO:
Company Address:
IKIO Lighting Limited
411, Arunachal Building,
19 Barakhamba Road, Connaught Place,
New Delhi – 110 001
Phone: +91 120 – 4116186
Email: secretarial@ikiolighting.com
Website: http://www.ikio.in/
Discussion on IKIO Lighting Limited IPO:
3 Comments
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I have applied. Issue was subscribed 66 times overall and 14 times by retail investors. Chance of getting allotment is very bleak. Can someone suggest the allotment norms followed in case of oversubscription like this?
can this be considered for long term ???
I am already stuck in ELIN
IKIO Upcoming IPO Analysis
1. Business Overview: IKIO Lighting Limited is an Indian manufacturer of light-emitting diode (LED) lighting solutions. The company is primarily an original design manufacturer (ODM) and designs, develops, manufactures, and supplies products to customers who then distribute these products under their own brands. The company’s products are categorized as (i) LED lighting; (ii) refrigeration lights; (iii) ABS (acrylonitrile butadiene styrene) piping; and (iv) other products.
2. Product Details: The LED lighting offerings focus on the premium segment and include lighting, fittings, fixtures, accessories, and components. The company provides lighting solutions (lights, drivers, and controls) to commercial refrigeration equipment suppliers under the refrigeration light segment. They also manufacture an alternative to polyvinyl chloride (PVC) piping called ABS piping that is primarily used by their US customers for plumbing applications.
3. Manufacturing: The company has four manufacturing facilities, one located in the SIDCUL Haridwar industrial park in Uttarakhand and three in Noida in the National Capital Region. They have backward integrated their major manufacturing processes and have developed in-house capabilities to manufacture all mechanical components in-house (except diodes and resistors).
4.Research and Development: The company has a dedicated R&D department that focuses on product designing, tools and mould designing, electronic circuit designing, and prototype designing. The R&D team consists of 27 members, 14 of whom hold Bachelors of Technology (Electronics & Communication and Mechanical) and the remaining 13 have a diploma in electronics/electricals and a graduate degree.
5. Financial Performance: The company’s revenue from operations has been increasing over the years. It was ₹220.25 crores in the year ended March 31, 2020, ₹213.45 crores in the year ended March 31, 2021, and ₹331.84 crores in the year ended March 31, 2022. As of December 31, 2022, the revenue was ₹328.63 crores.
Profit: The company’s profit after tax has also been on an upward trend. It was ₹21.41 crores in the year ended March 31, 2020, ₹28.81 crores in the year ended March 31, 2021, and ₹50.52 crores in the year ended March 31, 2022. As of December 31, 2022, the profit after tax was ₹51.35 crores
6. Customers: The company has a diverse customer base, primarily in the United States. They manufacture more than 753 SKUs for their largest customer, Signify (Philips) in India. They are also in negotiations with some of their existing customers to supply their LED home lighting products to their international supply chain.
7. Management: The company is led by a qualified and experienced management team. The Promoter, Hardeep Singh, is the Managing Director and Chairperson.
8. Valuation : EPS of Annualised Fy23 is 6.42 per share, so P/E is 44x which looks undervalued as compared to Industry peer 56x. Dixon is available at 90 P/E, ELIN is available at 31 P/E, Amber is available at 45 P/E and Syrma is available at 58 P/E.