Bumper debut: IKIO Lighting lists at 37% premium to issue price

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In line with analysts expectations, IKIO Lighting made a strong debut on June 16 on the bourses with a 37 percent premium to its issue price. The stock listed at Rs 391 on the NSE and BSE compared to issue price of Rs 285.

The maiden public issue of Noida-based IKIO was subscribed 66.30 times during June 6-8 with qualified institutional buyers' reserved portion being booked 163.58 times, high networth individuals 63.35 times, and retail 13.86 times.

Analysts had expected the stock to list at a premium of 30-35 percent. It was trading in the grey market at a similar premium before listing as well. Incidentally, the grey market premium came down in the last few days, which hit a peak of Rs 125 or 44 percent over the issue price.

IKIO has raised Rs 606.5 crore via public issue, at upper end of price band of Rs 270-285 per share, comprising fresh issue of Rs 350 crore.

Its products are categorised as LED lighting; refrigeration lights; ABS (acrylonitrile butadiene styrene) piping; and other products.

With population growth, rapid urbanization and improved demand for environmentally sustainable & cost-effective lighting solutions, the market of LED lighting has increased rapidly in the recent years. During FY18-22, the domestic LED lighting market has increased by 12.4 percent CAGR to Rs 21,708 crore.

Further, with improved applications across the residential, commercial and industrial areas, the domestic LED lighting market is expected to increase by 11.7 percent CAGR over FY22-26 to reach a size of Rs 33,820 crore.

The electronics manufacturing services (EMS) market supporting the domestic LED lighting market has increased by 21.5 percent CAGR during FY18-22 to Rs 4,800 crore and is expected to grow by 27 percent CAGR over FY22-26 to a size of Rs 12,500 crore, as per RHP.