Choice Equity Broking, Knack Packaging Ltd
Knack Packaging Ltd. (KPL), Incorporated on March 4, 2013, the company is among India’s leading integrated, innovation-driven, export-oriented, and sustainability-focused packaging solutions providers. It offers a diverse portfolio of packaging products, including Printed and Laminated Woven Polypropylene (PLWPP) bags and PLWPP Pinch Bottom bags, which are high-strength, customized packaging solutions catering to industries such as food products and pet food. The company’s packaging solutions help enhance brand visibility, mitigate counterfeiting risks, and improve operational efficiency for customers. With an estimated market share of approximately 10.1% in the Indian flexible bulk PLWPP bags market, including PLWPP Pinch Bottom bags, in FY25, the company has established a strong position within the industry. • The IPO comprises a combination of fresh issue (Rs. 380.00) and OFS (Rs. 56.35 - 59.50cr). Company will not be utilizing any proceeds from the OFS portion. From the fresh issue net proceeds, the company will be utilizing Rs. 320cr for partial funding of capital expenditure towards setting up of new manufacturing facility at Borisana situated at Kadi, Mehsana, Gujarat. Residual amount will be used for general corporate purposes.
Valuation and Outlook
Additionally, a significant portion of the company's revenue is generated from exports, and its joint venture in Mexico is expected to strengthen its international presence, expand its customer base, and enhance brand recognition in overseas markets. Although the issue appears to be fully priced, the company's consistent financial performance, ongoing capacity expansion, strong export presence, and long-term growth initiatives provide comfort. Accordingly, we recommend ‘Subscribe for Long Term' rating to the issue.
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Knack Packaging - 290626 - choice