Epack Durables shares to debut tomorrow. What GMP signals ahead of listing?

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The shares of Epack Durables will debut on the bourses on Tuesday following a successful IPO, which was subscribed 16 times at close. Ahead of the listing, the company’s shares are trading with a marginal premium of Rs 6 as against an issue price of Rs 230.

Epack Durables GMP has been consistently on a downward trend since the close of the IPO. However, going by the current trends, the stock is expected to list at a premium of 2.6%.

It is important to note that grey market premiums are just an indicator as to how the company’s shares are stacked up in the unlisted market and are subject to change rapidly.

Fresh proceeds from the IPO will be used to fund capital expansion plans and repay part of its outstanding debt.

Epack Durable is the second largest room air conditioner original design manufacturer (ODM) in India in terms of the number of units in FY23. Its current product portfolio comprises room air conditioners where it designs and manufactures complete RACs, small domestic appliances, and components.

The company has a 24% market share in terms of domestically manufactured units by ODM in FY23. The plants are vertically integrated and automated would improve the margins going forward.

Its strengths include its long-standing relationships with top customers, advanced vertically integrated manufacturing, and robust product development capabilities.The company’s revenue, EBITDA and PAT grew at a CAGR of 44.6%, 56.2%, and 102.5%, respectively during the FY21-23 period.

For the six months ended September 2023, the company reported revenue of Rs 615 crore, while net profit stood at Rs 2.6 crore. In FY23, the company’s revenue from operations rose 66% year-on-year to Rs 1,539 crore and profit jumped 88% to Rs 32 crore.

Axis Capital, DAM Capital Advisors, and ICICI Securities acted as the book running lead managers to the issue.

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