Kahan Packaging's IPO has set a remarkable record in the SME segment, receiving a subscription rate of 690 times the offer size, the highest ever seen for IPOs announced up to September 8, the closing day for bidding. The demand for the IPO has been consistently strong since its opening.

Investors snapped up 49.67 crore equity shares over three days starting from September 6, surpassing the offer size of 7.2 lakh shares, resulting in a subscription rate of 689.92 times. This incredible demand translates to shares worth Rs 3,973.95 crore being bid for, compared to the total IPO fundraising amount of Rs 5.76 crore.

Retail investors showed the most significant support for the bulk packaging solutions provider, with a subscription rate of 1,044.8 times their allocated quota. High net worth individuals (HNIs) and other investors also displayed strong interest, purchasing 14.15 crore shares, which is 416.2 times their reserved portion.

Of the total issue size of 7.2 lakh shares, the Mumbai-based company reserved 40,000 equity shares for the market maker, while the remaining 6.8 lakh shares were split equally between retail investors and HNIs, with 3.4 lakh shares for each.

Prior to this, the Olatech Solutions IPO, launched in August the previous year, held the record with a subscription rate of 598.82 times, now ranking second.

Kahan Packaging is a polypropylene (PP) and high-density polyethylene (HDPE) woven fabric manufacturer that specializes in providing customized bulk packaging solutions to business-to-business (B2B) manufacturers in industries such as agro-pesticides, cement, chemicals, fertilizers, and food products.

Promoted by Prashant & Rohit Dholakia, Kahan Packaging intends to utilize the net issue proceeds of Rs 4.94 crore primarily for working capital requirements (Rs 4 crore) and the remainder for general corporate purposes.

For the financial year ending March FY23, the company reported a net profit of Rs 1.03 crore, a significant increase from Rs 0.2 crore in the previous year. Additionally, the revenue from operations rose from Rs 15.88 crore to Rs 17.5 crore during the same period, with nearly 99 percent of the revenue coming from Maharashtra in FY23.

The IPO schedule includes the finalization of the basis of IPO share allotment by September 13, with eligible investors receiving shares in their demat accounts by September 15. Refunds for unsuccessful investors will be credited to their bank accounts by September 14. Trading in equity shares is scheduled to commence on the BSE SME on September 18.

Hem Securities is the merchant banker for the issue.

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