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Key Points

Kent RO Systems has secured SEBI approval for its initial public offering, marking a significant milestone for the water purifier company. The IPO is a pure offer for sale by promoters Sunita, Mahesh, and Varun Gupta, involving 10.1 million shares. The company's financials show a remarkable 71% profit increase in FY24, rebounding from a previous year's downturn. JM Financial and Motilal Oswal will manage the IPO, with the price band yet to be disclosed.

Key Points: Kent RO IPO Approved Amid Profit Surge and Financial Volatility

  • Kent RO profits jump 71% in FY24 after previous year's decline
  • Pure offer for sale by promoter shareholders
  • Revenue grows 8.65% year-on-year to Rs 1,178.1 crore
2 min read

Kent RO gets SEBI nod for IPO, DRHP shows mixed financial performance over years

Kent RO Systems receives SEBI nod for IPO, showcasing strong FY24 performance after previous year's profit decline

"Our financial journey reflects resilience and strategic growth - Kent RO Management"

Mumbai, June 12

Kent RO Systems, a water purifier company, has received approval from the Securities and Exchange Board of India (SEBI) to launch its initial public offering (IPO).

While this marks an important milestone for the company, its financials tell a mixed story with some concerns.

Kent RO's latest financial data reveals a strong profit jump in FY24, but this comes after a sharp fall in the previous fiscal (FY23).

The company had posted a profit of Rs 166.5 crore for the year ended March 31, 2024, compared to Rs 97.1 crore in FY23.

While this is a big jump of around 71 per cent, it's important to note that the profit had dropped by over 37 per cent in FY23 from Rs 154.2 crore in FY22.

The company's total expenses also rose by 6.42 per cent year-on-year (YoY), from Rs 976.9 crore in FY23 to Rs 1,039.6 crore in FY24.

According to the DRHP, the company reported revenue from operations of Rs 1,178.1 crore for the FY24, compared to Rs 1,084.3 crore in the previous financial year.

This marks a growth of around 8.65 per cent YoY. Total income for FY24 stood at Rs 1,260.6 crore, up from Rs 1,109.1 crore in FY23 -- an increase of 13.65 per cent.

Meanwhile, for the six-month period ending September 30, 2024, Kent RO reported revenue from operations at Rs 637.1 crore and total income at Rs 684 crore.

During the same period, the company recorded expenses of Rs 594.6 crore and a profit of Rs 69.6 crore, as per the DRHP paper.

The IPO, which is a pure offer for sale (OFS), will see 10.1 million shares offloaded by promoters Sunita Gupta, Mahesh Gupta, and Varun Gupta.

Since it is not a fresh issue, the company itself will not receive any funds from this public offering.

The draft paper was filed with SEBI on January 23, and the approval came on June 6. The IPO price band has not been disclosed yet.

JM Financial and Motilal Oswal Investment Advisors will act as the book-running lead managers, while KFin Technologies is the registrar to the issue.

- IANS

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Reader Comments

R
Rajesh K.
Kent RO makes good products but these financial ups and downs are worrying. IPO investors should be careful - last year's 71% profit jump looks great but remember the 37% fall before that! Market is already volatile, need stable companies. 🧐
P
Priya M.
We've used Kent purifier for 8 years - excellent after-sales service. But IPO is pure OFS? Promoters cashing out instead of raising funds for company growth? Doesn't inspire confidence. Better wait for listing price before jumping in.
A
Amit S.
Water purifier market has huge potential in India with increasing health awareness. Kent is trusted brand but facing tough competition from Eureka Forbes & others. Their 8.65% revenue growth is decent but not outstanding. Will watch this space!
S
Sunita R.
Expenses rising faster than revenue (6.42% vs 8.65%) is red flag 🚩. Also why such wild profit swings? From 154cr to 97cr to 166cr? Either accounting issues or unstable business model. SEBI should ask tougher questions before approving such IPOs.
V
Vikram J.
Positive: Strong brand recall, essential product category. Negative: Entire Gupta family selling shares? Looks like they want exit at peak valuation. I'll wait for Q3 results before considering investment. "Jaldi ka kaam shaitaan ka" as they say!
N
Neha T.
As middle class consumer, Kent products are expensive but reliable. However as potential investor, not sure about this one. Company not getting any money from IPO means no growth plans funded? Seems like missed opportunity to expand in tier 2/3 cities.

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