In this article, we delve into the details of Karnika Industries Limited’s upcoming Initial Public Offering (IPO). Established in 2017, Karnika Industries Limited, formerly known as Karni International, has become a leading destination for stylish children’s clothing in India. The company specializes in the design and export of a diverse range of children’s wear, including comfortable shorts, trendy capri pants, cozy sleepsuits, warm winter wear, and adorable infant clothing.
Karnika Industries Limited boasts well-established manufacturing units equipped with cutting-edge machinery and tools required for modern garment production. Their meticulous process includes designing and crafting samples, rigorous quality checks, ironing, and careful packaging to ensure the highest quality products. The company offers various sub-brands or sub-categories to cater to different tastes and preferences, including KARNIKA Care, KARNIKA Cool, KARNIKA Cube, KARNIKA Life, KARNIKA Key, and KARNIKA Club.
With a diverse range of kids’ clothing and a strong commitment to quality, Karnika Industries Limited serves various segments within the children’s fashion market, whether it’s in India or abroad.
Objects of the Issue
Meeting Working Capital Requirement: One of the fundamental reasons for a company to go public through an IPO is to secure funds for its day-to-day operations. This includes covering essential expenses like employee salaries, inventory procurement, managing overhead costs, and addressing short-term financial needs. By raising capital from the public through the IPO, Karnika Industries ensures it has the necessary financial resources to maintain smooth business operations and capitalize on growth opportunities.
General Corporate Purpose: The category of “General Corporate Purpose” encompasses a wide range of potential uses for the funds raised through the IPO. These funds can be allocated for diverse corporate needs, such as expanding into new markets, investing in research and development, acquiring other companies, debt repayment, or strategic investments. This flexibility allows the company to utilize the capital effectively to achieve its long-term goals and objectives.
Meeting the Issue Expenses: Going public involves certain expenses related to the IPO process. These expenses encompass underwriting fees, legal and accounting fees, regulatory compliance costs, and marketing expenses to promote the IPO to potential investors. The funds generated from the IPO will cover these initial costs, ensuring a successful launch of the company’s stock in the public market.
Karnika Industries Limited IPO Details
IPO Date: The IPO subscription period for Karnika Industries Limited is scheduled to run from September 29, 2023, to October 4, 2023.
Face Value: The face value of each share is ₹10.
Price per Share: The IPO price per share is ₹76.
Lot Size: The lot size for this IPO is 1600 shares.
Total Issue Size: Karnika Industries plans to issue a total of 3,299,200 shares, aggregating up to ₹25.07 Crores.
Fresh Issue: The entire issue consists of fresh shares, amounting to 3,299,200 shares aggregating to ₹25.07 Crores.
Issue Type: This is a Fixed Price Issue IPO.
Listing: The company intends to list its shares on the NSE SME (National Stock Exchange Small and Medium Enterprises) platform.
Shareholding Pre-Issue: Prior to the IPO, Karnika Industries Limited had a total of 9,100,300 shares.
Shareholding Post-Issue: Following the IPO, the promoters’ collective shareholding in the company will be reduced to 73.39%. This signifies that, after going public and issuing shares to external investors, the promoters will retain significant ownership but no longer hold 100% of the company’s shares.
Market Maker Portion: A portion of 166,400 shares has been allocated to market makers.
Karnika Industries Limited IPO Reservation
In an IPO, certain shares are typically reserved for specific groups or investors. Here’s how the reservation is allocated in Karnika Industries Limited’s IPO:
Other Shares Offered: This category refers to a portion of the shares made available to specific categories of investors or institutions. In this case, it represents 50% of the net offer.
Retail Shares Offered: This portion of shares is specifically earmarked for individual retail investors. Retail investors are everyday individuals who invest in stocks for personal investment portfolios. Similar to “Other Shares Offered,” this allocation also represents 50% of the net offer.
Karnika Industries Limited IPO Lot Size
The lot size for Karnika Industries Limited IPO is as follows:
Retail (Minimum): 1 lot, consisting of 1600 shares, with an amount of ₹121,600.
Retail (Maximum): 1 lot, consisting of 1600 shares, with an amount of ₹121,600.
HNI (High Net Worth Individuals) (Minimum): 14 lots, totaling 22,400 shares, with an amount of ₹243,200.
Karnika Industries Limited IPO Promoter Holding
The promoters of Karnika Industries Limited are Mr. Niranjan Mundhra, Mr. Shiv Shankar Mundhra, and Mr. Mahesh Kumar Mundhra. Here’s a look at their pre-issue and post-issue shareholding:
Share Holding Pre-Issue (Before the IPO): Before the IPO, the promoters collectively held 100.00% of the company’s shares, indicating complete control and ownership.
Share Holding Post-Issue (After the IPO): Following the IPO, the promoters’ collective shareholding in the company will reduce to 73.39%. This means that, after going public and issuing shares to the public, the promoters will still retain ownership of a significant portion of the company, but they will no longer possess 100% of the shares.
Karnika Industries Limited IPO Tentative Dates
Mark your calendars for the following tentative dates related to Karnika Industries Limited’s IPO:
IPO Open Date: Friday, September 29, 2023.
IPO Close Date: Wednesday, October 4, 2023.
Basis of Allotment: Monday, October 9, 2023.
Initiation of Refunds: Tuesday, October 10, 2023.
Credit of Shares to Demat: Wednesday, October 11, 2023.
Listing Date: Thursday, October 12, 2023.
Cut-off time for UPI mandate confirmation: 5 PM on October 4, 2023.
Karnika Industries IPO Registrar
For inquiries related to Karnika Industries Limited IPO, you can contact the registrar:
Registrar: Skyline Financial Services Private Ltd.
Email: [email protected].
Website: Skyline Financial Services.
Frequently Asked Questions (FAQ)
What is Karnika Industries IPO?
Karnika Industries IPO is a Small and Medium Enterprises (SME) IPO consisting of 3,299,200 equity shares with a face value of ₹10, aggregating to ₹25.07 Crores. The issue price per share is ₹76. The IPO subscription period is from September 29, 2023, to October 4, 2023, and it is set to be listed on the NSE SME platform.
How can Zerodha customers apply for Karnika Industries IPO?
Zerodha customers can apply for Karnika Industries IPO online using UPI as a payment gateway. The application process involves logging into Zerodha Console (back office) and submitting an IPO application form.
When will Karnika Industries IPO open for subscription?
The Karnika Industries IPO is scheduled to open for subscription on September 29, 2023.
What is the lot size for Karnika Industries IPO?
The lot size for Karnika Industries IPO is 1600 shares, with a minimum investment amount of ₹121,600 for retail investors.
How can one apply for Karnika Industries IPO?
Investors can apply for Karnika Industries IPO online, choosing between UPI or ASBA as their payment method. ASBA IPO application is accessible through the net banking of their respective bank accounts.
When is the tentative listing date for Karnika Industries IPO?
The tentative listing date for Karnika Industries IPO is Thursday, October 12, 2023.
Is there a cutoff time for UPI mandate confirmation?
Yes, the cutoff time for UPI mandate confirmation is 5 PM on October 4, 2023.