About the Company:
JNK India Ltd is one of the leading Heating Equipment companies in India in terms of new order booking between Fiscal 2021 to Fiscal 2023.
Company has capabilities in thermal designing, engineering, manufacturing, supplying, installing and commissioning process fired heaters, reformers and cracking furnaces.
Company is one of the well-recognized process fired heater companies in India, having a market share of approximately 27% in the Indian Heating Equipment market, in terms of new order booking in Fiscal 2023.
In India, Company has completed projects in, amongst others, Andhra Pradesh, Assam, Bihar, Karnataka, Kerala, Maharashtra, Tamil Nadu, West Bengal and globally have completed projects in Nigeria and Mexico.
Further, Company has ongoing projects in Gujarat, Odisha, Haryana, Rajasthan in India and globally in Oman, Algeria, and Lithuania.
Further, company has successfully completed projects which were based in far-reaching locations, which included our projects in India at Numaligarh, Assam; Kochi, Kerala; Barauni, Bihar; and overseas at Lagos, Nigeria.
As of March 31, 2023, Company has served 17 Customers in India and seven Customers overseas.
Further, seven out of the 12 oil refining companies in India, are company’s customers and have supplied or are in the process of supplying Heating Equipment to 11 of the 24 operating oil refineries across India.
Company’s Promoter Background (JNK Heaters):
JNK Heaters is the Corporate Promoters of JNK India Ltd with a shareholding of 25.79%.
JNK Heaters was established in 1998 and has been engaged, inter alia, in the design, manufacturing, installation of process fired heaters. JNK Heaters is the only industrial-use process fired heater producer in Korea and is ranked amongst the top three industrial use process fired heater producers globally.
Since inception, Company has been working closely with JNK Heaters a KOSDAQ listed company. The relationship between JNK India Ltd and JNK Heaters is both independent and collaborative in nature.
While for certain projects, JNK India Ltd is able to participate independently and acquire projects in Heating Equipment, for certain projects we partner as a global joint engineering and implementing partner for JNK Heaters.
Company’s Customers:
- Indian Oil Corporation Ltd.
- Tata Projects Ltd.
- Rashtriya Chemicals & Fertilizers Ltd.
- Numaligarh Refinery Ltd.
- JNK Heaters Ltd.
Company’s Order Book:
Company’s Order Book value was Rs.868.2 crores on March 31, 2023, out of which Rs.772.8 crores or 89.01% was from the Indian market and Rs.95.4 crores or 10.99% was from the overseas market.
Company’s Revenue from various business segments:
Company’s Order Book and Order Wins: (in millions)
As part of Company’s business lets understand the purpose of process fired heaters, heaters, reformers and cracking furnaces:
- A process fired heater is a type of industrial heater used to heat fluids or gases directly by burning a fuel source such as natural gas or propane.
- Reformers are devices used to convert hydrocarbons, such as natural gas or naphtha, into synthesis gas or syngas, which is a mixture of hydrogen and carbon monoxide.
- Further, cracking furnaces are used to break down large hydrocarbon molecules into smaller ones, which can then be used to produce a variety of products, including fuels, chemicals, and plastics. The process of breaking down hydrocarbons is known as cracking, and it typically involves heating the hydrocarbon feedstock in the presence of a catalyst.
- The process fired heaters, reformers and cracking furnaces (together, the “Heating Equipment”) are required in process industries such as oil and gas refineries, petrochemicals, fertilizers, hydrogen and methanol plants etc.
What is the use of Heating equipments in Refineries and Petrochemical plants?
- Heating equipment such as process fired heaters and reformers are used in a typical refinery and are also an effective and efficient heating solution for a wide range of industrial applications, but proper design, installation, and operation are critical to ensure safe and reliable performance.
- Process fired heaters are the critical equipment in a refinery. Around 10 – 20 process fired heaters are used in any typical refinery.
- Further, various Heating Equipment such as process fired heaters, reformers and cracking furnaces are used in a petrochemical plant as well. Reformers and cracking furnaces are the most critical equipment in a petrochemical plant.
Company has Entered the Flares and Incinerators Systems Business.
Considering that company is already manufacturing process fired heaters for oil and gas refineries and petrochemical industries already, in order to cater to the increased demand for flares and incinerators systems both in domestic as well as overseas market due to emission control norms getting stricter, company has diversified into flares and incinerators systems as well.
Flare systems are important safety devices used in refinery and petrochemical facilities to burn excess hydrocarbon gases which cannot be removed or recycled.
While flaring systems are used across refinery, petrochemical and fertilizer plants, incinerators are primarily used in the refinery.
Company’s Export purposes only Fabrication Facility at Mundra, Gujarat:
Fabrication is undertaken in company’s in-house fabrication facilities and/or through third party fabricators. Company has a fabrication facility situated at multi-product special economic zone at Mundra, Gujarat, where fabrication is undertaken for export purposes only.
It spreads over approximately 20,243 square meters with an installed capacity of 5,000 metric tonnes of fabrication and modularization per annum.
Company’s Manufacturing Capacity & Capacity Utilization:
JNK Renewable Energy Pvt Ltd (Company’s Subsidiary)
Company is also working on building capabilities in renewable sector with green hydrogen as well through our subsidiary JNK Renewable Energy Private Limited.
Currently company supplies grey hydrogen through onsite and offsite production and storage systems and further propose to foray into engineering solution for hydrogen or green energy industry.
As of March 31, 2023, company has installed one hydrogen refuelling stations, at Indian Oil R&D Centre, Faridabad, Haryana. Company plans to leverage the technical know-how of JNK Heaters to capitalize on future growth opportunities in the hydrogen refuelling station systems (“HRS”) in India.
Company’s Key Performance Indicators: (in millions)
Competitors in the Business:
- Company’s competitors include names like Thermax Ltd, BHEL Ltd, Esteem Projects Pvt Ltd, Heurtey Petrochem Solutions, TR Engineering, and ITT Engineering India.
Management Team:
- Mr. Arvind Kamath (Designation: Chairperson and Whole Time Director)
- Mr. Dipak Kacharulal Bharuka (Designation: Whole Time Director and Chief Executive Officer)
Objectives of the Issue:
Offer For Sale: (Rs.350 cr)
- Company will not receive any proceeds from the Offer for Sale. The Selling Shareholders will be entitled to their respective portion of proceeds of the Offer for Sale.
Fresh Issue: (Rs.300 cr)
- Funding working capital requirements.
- General corporate purposes.
Fund Utilization:
| Particulars | Amount (Rs. in Crores) |
|---|---|
| Funding working capital requirements | 275.7 cr |
Positives for the Company:
Market Leader of Process Fired Heaters in India with Established Track Record.
- Company is one of the leading Heating Equipment companies in India in terms of new order booking between Fiscal 2021 to Fiscal 2023 and have capabilities in thermal designing, engineering, manufacturing, supplying, installing and commissioning process fired heaters, reformers and cracking furnaces.
- Company is one of the well-recognized process fired heater companies in India, having a market share of approximately 27% in the Indian Heating Equipment market, in terms of new order booking in Fiscal 2023.
- Company had commenced operations in 2010 and have a successful project completion track record of over 10 years.
Company’s Customers include Leading Refineries & Petrochemical Companies.
- Some of company’s domestic Customers include Indian Oil Corporation Ltd, Tata Projects Ltd, Rashtriya Chemicals & Fertilizers Ltd and Numaligarh Refinery Ltd.
- Further company has catered to overseas Customers such as a leading oil & gas exploration & production company in Oman and a middle east arm of European EPC company in oil and gas.
- Company has also enjoyed repeat orders from certain large domestic Customers such as Rashtriya Chemical & Fertilizers Ltd, Tata Projects Limited, Numaligarh Refinery Ltd and Indian Oil Corporation Ltd.
Well Positioned to Capture Industry Tailwinds.
- Growing demand for transportation fuels and petrochemical feedstock are the primary growth enablers of the Indian refinery industry. There are 18 refinery projects expected to be commissioned by Fiscal 2031 with a cumulative capacity of 124.0 MMTPA.
- Similarly, there has been a rise in the global oil and gas refinery and petrochemical capacities thereby by driving the growth in the global process fired heaters market.
- Further, in the overseas market where company operates, there are 52 refinery projects that are likely to be commissioned between calendar year 2025 and calendar year 2030, with an installed capacity of these projects being 510.9 MMTPA.
- Company believes that it is well positioned to capitalise on the upcoming demand of Heating Equipment.
Strong Promoter Group (JNK Heaters).
- Since company’s inception it is working closely with JNK Heaters. JNK Heaters is involved in the design, manufacturing, installation of process fired heaters.
- JNK Heaters is the only industrial-use process fired heater producer in Korea and is ranked amongst the top three industrial use process fired heater producers globally.
- Rise in global oil and gas refinery and petrochemical capacities are the key factors driving the growth in the global process fired heaters market.
- Company is able to leverage JNK Heaters’ global position, to bid for larger projects in collaboration with JNK Heaters.
Company is Actively Evaluating Inorganic Opportunities to Enhance Presence in Newer Product Categories.
- Company is actively evaluating opportunities in acquiring technology and knowhow with an aim to enhance presence in newer product categories and deepen penetration in the target markets.
- Company intends to expand the Customer network in some of the overseas markets including Europe, so as to capitalise on the untapped opportunities.
- Company proposes to continue to pursue inorganic growth opportunities in relatively larger markets such as Italy, Middle East and Africa. Further, Company is also evaluating tie-ups / arrangements with players having technology know-how in areas such as flares and incinerators systems and electrolyser technology for hydrogen generation.
Company is working on building capabilities in renewable sector with green hydrogen.
- Company is working on building capabilities in renewable sector with green hydrogen. Company is also building capabilities in renewable sector with onsite hydrogen production, hydrogen fuel stations and solar photovoltaic – EPC (“Solar PV-EPC”) which forms part of green hydrogen value chain.
- Company plans to leverage the technical know-how of JNK Heaters to capitalize on future growth opportunities in renewable energy systems in India.
Company’s Order Book in Increasing Continously.
- Company’s Order Book value was Rs.868.2 crores on March 31, 2023, out of which Rs.772.8 crores or 89.01% was from the Indian market and Rs.95.4 crores or 10.99% was from the overseas market.
- Company’s strong Order Book position is a result of our established track record of successful execution of projects, which has led to company’s ability to successfully bid and win new projects.
- Company’s successful efforts to meet the rising pre-qualification requirements of some of our Customers has enhanced company’s competitiveness in the target market and has enabled us to maintain the momentum in Order Book.
Financials of the Company:
| (in Crores) | FY 21 | FY 22 | FY 23 | Upto 31st Dec 23 |
|---|---|---|---|---|
| Revenue | 138.4 | 297.1 | 411.5 | 256.76 |
| Net Profit | 16.4 | 35.9 | 46.3 | 46.21 |
Valuation of Peer Group Companies:
| Company Name | Face Value | EPS | PE Ratio | RoNW | NAV |
|---|---|---|---|---|---|
| JNK India Ltd | 2 | 9.51 | 43.63 | 47.71% | 25.45 |
| Thermax Ltd | 2 | 39.98 | 62.88 | 12.24% | 324.62 |
IPO Details:
| Details | Info |
|---|---|
| Issue Opens on | 23rd April 2024 |
| Issue Closes on | 25th April 2024 |
| Issue Price | Rs.395 -415 |
| Face Value | Rs.2 |
| Retail Category Allocation | 35% |
| Minimum Lot | 36 Shares |
| Minimum Investment | Rs.14,940 |
| Issue Constitutes | 28.13% |
| Issue Size | Rs.650 cr ($78 million) |
| Market Cap | Rs.2308 cr ($278 million) |
| Listing at | NSE & BSE |
| Equity Shares Offered (Fresh) | 72,28,915 |
| Equity Shares Offered (OFS) | 84,21,052 |
| Total Equity Shares Offered (Fresh + OFS) | 1,56,49,967 |
| Equity Shares Prior to the Issue | 4,83,92,00 |
| Equity Shares after the Issue | 5,56,20,915 |
Important Dates:
| Finalization of Basis of Allotment | On or Before 26th April 2024 |
| Initiation of Refunds | On or Before 29th April 2024 |
| Credit of Equity Shares: | On or Before 29th April 2024 |
| Listing Date: | On or Before 30th April 2024 |
IPO Valuation Parameters:
| Earnings Per Share (EPS) | Price To Earnings ratio (PE) | Return on Net Worth (RoNW) | Net Asset Value (NAV) | Debt Equity Ratio (D/E) |
|---|---|---|---|---|
| 9.51 | 43.63 | 47.71% | 25.45 | 0.28 |
Also Read: Complete List of NSE/BSE Holidays List>>
| Should You Subscribe or Not ? (Markets Guruji’s View) |
|---|
| JNK India Ltd stands as a beacon of excellence in the realm of Heating Equipment within India. With a robust portfolio spanning thermal designing, engineering, manufacturing, and commissioning, it has established itself as a stalwart in the industry. Specializing in process fired heaters, reformers, and cracking furnaces, JNK India Ltd boasts a significant market presence, commanding approximately 27% of the Indian Heating Equipment market share.
A noteworthy aspect of the company’s structure is its strategic partnership with JNK Heaters, a prominent South Korean entity, which holds a substantial 25% stake in JNK India Ltd. Leveraging the expertise and global standing of its Korean counterpart, JNK India Ltd has fortified its position not only domestically but also on the international stage. The company’s formidable Order Book value of Rs. 868.2 crores as of March 31, 2023, underscores its robust financial health and promising growth trajectory. Moreover, JNK India Ltd is spearheading initiatives in renewable energy through its subsidiary, JNK Renewable Energy Pvt Ltd, with a focus on green hydrogen, aligning with global sustainability imperatives. With such compelling fundamentals and visionary ventures, JNK India Ltd emerges as an enticing investment opportunity.Markets Guruji recommends participation in its IPO, foreseeing substantial gains upon listing. JNK India Ltd stands poised to not only sustain its leadership in the Heating Equipment sector but also pioneer innovation and sustainability in the years to come. |
| Company Contact Info: |
|---|
| JNK India Limited Unit No. 203, 204, 205 & 206 Opposite TMC Office, Centrum IT Park Near Satkar Hotel,Thane -West Thane 400 604, Maharashtra, India Tel: + 91 22 6885 8000 Email: compliance@jnkindia.com Website: www.jnkindia.com |
| Registrar to the Issue: |
|---|
| Link Intime India Private Limited C-101, 1st Floor, 247 Park L.B.S. Marg, Vikhroli West Mumbai 400 083 Maharashtra, India Tel: +91 810 811 4949 E-mail: jnkindia.ipo@linkintime.co.in Website: www.linkintime.co.in |
| Check IPO Allotment Status: |
|---|
Link InTime Website (Click on the below Link)https://linkintime.co.in/IPO_Allotment_Check |
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