Jinkushal Industries
IPO Size: Rs. 116 cr
- Fresh Issue of Rs. 104 cr for working capital funding of Rs. 73 cr
- Offer for Sale (OFS) of Rs. 12 cr by the promoter (99% to drop to 74%)
Price band: Rs. 115-121 per share
M cap: Rs. 464 cr, implying 25% dilution
IPO Date: Thu 25th Sep to Mon 29th Sep 2025, Listing Fri 3rd Oct 2025
Grey Market Premium (GMP): We are strongly against ‘grey market premium’ as it is an unofficial figure, against SEBI guidelines.
Raipur-based Construction Machine Exporter
Jinkushal Industries exports construction machines, such as, hydraulic excavators, backhoe loaders, motor grades, concrete mixer trucks, soil compactors etc. to 30 countries, mainly on B2B basis. Top 5 clients account for 75% of revenue. Also, Mexico accounts for 3/4th of Rs. 380 cr revenue, with UAE, UK, Netherlands and Australia being other countries.
Revenue Mix
61% of topline comes from sale of new machines, 35% from used/ refurbished machines and 4% from proprietary brand ‘HexL’. Surprisingly, company has not disclosed annual sales volume, making volume growth and realization analysis difficult.
Jinkushal does not have own manufacturing facility, but gets them through Chinese contract manufacturers. Having commenced sale under Hexl towards end of Q3FY25, only 40 machines have been sold till date, so potential of own brand is yet to be proven.
Financials Not Comforting
Revenue was flat at Rs. 238 cr in FY24 and then rose 60% YoY in FY25, to Rs. 380 cr.
In FY25, EBITDA excluding other income was flat YoY at Rs. 23 cr, so was the PAT, stagnant YoY at Rs. 19 cr, implying 5% net margin. Other income like forex and treasury gain, accounted for 22% of PBT. FY25 EPS was reported at Rs. 6.15.
In FY25, refurbished machines accounted for 35% of revenue, with net margin at 5%. In FY23, when revenue from refurbished, which fetch superior margin that new machines, was less than Rs. 1 cr, net margin stood at 4.3%. Thus, company’s financials do not provide comfort to potential investors. Besides, margin are lower than peers with used construction equipment segment being highly price competitive.
Unattractive Pricing
M cap of Rs. 464 cr and enterprise value (EV) of Rs. 483 cr implies a PE of 20x and an EV/EBITDA multiple of 17x. This is quite expensive for a small trader with limited geographic distribution, and not yet a proven OEM (original equipment manufacturer).
Construction equipment OEM Action Construction Equipment (ACE) with 15% net margin on Rs. 3,300 cr topline, is trading at a PE of 30x, while Vision Infra Equipment, with Rs. 443 cr topline in FY25, Rs. 31 cr PAT excluding one-off has higher net margin of 7% than Jinkushal’s 5% as well as significantly higher EBITDA margin of 27%, against Jinkushal’s 8%. Yet Vision Infra is trading at an EV/EBITDA of 6x and 17x PE multiple.
