Rexpro Enterprises Limited has opened its IPO to strong market interest, with a price band set at ₹145 per share. The IPO comprises a fixed price issue of ₹53.65 crores, with a fresh issue of 32.50 lakh shares worth ₹47.13 crores and an offer for sale of 4.50 lakh shares totaling ₹6.53 crores. The subscription opened on January 22, 2025, and closes on January 24, 2025, with the allotment expected on January 27, 2025. The shares are set to debut on the NSE SME platform on January 29, 2025.

Key Business Strengths

Rexpro Enterprises, founded in 2012 and based in Vashi, Maharashtra, is a diversified manufacturer specializing in furniture and fixtures. The company has strong in-house capabilities, focusing on sound barriers for infrastructure projects and precision-engineered double doors for metro stations. Clients include Shoppers Stop, Hindustan Unilever, Samsung (One RX India Private Limited), Lenskart, and Marks & Spencer Reliance India Private Limited, reflecting its reach across retail, commercial, and infrastructure sectors.

IPO Financial Highlights

• Price Band: ₹145 per equity share
• Market Capitalization: ₹162.49 crores at IPO price
• Lot Size: 1,000 shares; Minimum Investment for Retail Investors: ₹1,45,000; HNIs: ₹2,90,000 (2 lots)
• Book Running Lead Manager: Horizon Management Private Limited
• Registrar: Cameo Corporate Services Limited
• Market Maker: Giriraj Stock Broking Private Limited

Strong Financial Performance

Rexpro Enterprises has shown consistent growth in revenues, with financial highlights reflecting solid business fundamentals:

• Revenue from Operations (₹ Lakh): FY22 - 3,571.48; FY23 - 6,289.18; FY24 - 8,301.10; Sept 2024 - 4,956.47
• EBITDA (₹ Lakh): FY22 - 135.02; FY23 - 165.24; FY24 - 808.55; Sept 2024 - 627.96
• Profit After Tax (PAT) (₹ Lakh): FY22 - 51.61; FY23 - 63.95; FY24 - 518.34; Sept 2024 - 408.27

The company demonstrates strong metrics, including a pre-issue EPS of ₹5.69 and a pre-issue P/E ratio of 25.48x, which is attractive compared to the industry P/E ratio of 40x. The IPO also boasts an impressive ROCE of 62.21% and ROE of 56.24% for FY24.

Grey Market Premium (GMP) Analysis

The Grey Market Premium (GMP) for Rexpro Enterprises IPO is ₹21, translating to an expected listing price of ₹166 (14.48% premium). While the GMP reflects market sentiment, it should not be the sole determinant for investment.

Subscription and Allotment Details

As of 11:00 AM on January 24, 2025, the IPO had been subscribed 8.33 times, showcasing strong interest. The allotment process will be completed by January 27, 2025, and investors can check their status online using the following steps:

1. Visit the registrar's allotment page.
2. Select "Rexpro Enterprises IPO" from the dropdown.
3. Enter your application number, PAN, or DP Client ID.
4. Submit to view your allotment status.

IPO Objectives

The proceeds from the IPO will be utilized for:

1. ₹25 crores for the purchase of equipment and renovation of factory.
2. ₹10 crores for funding working capital requirements.
3. ₹3.52 crores for pursuing inorganic growth opportunities.
4. Remaining funds for general corporate purposes.

Growth Opportunities and Risks

With its focus on sectors like retail and infrastructure, Rexpro Enterprises has significant opportunities for expansion. The company’s diverse product range, including trolleys, racks, and cabinets, ensures a steady demand pipeline. Additionally, the infrastructure sector provides growth potential through sound barriers and metro station projects.

However, challenges include reliance on major clients and competition from well-established industry players. The company's ability to maintain profit margins and diversify its client base will be critical to sustaining growth.

Conclusion

Given its strong financial performance, fair pricing, and growth potential, Rexpro Enterprises IPO offers an attractive opportunity for risky investors seeking listing gains. With its promising GMP of 14.48%, it reflects positive market sentiment, though investors are advised to assess risks carefully.

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