Inox India Ltd IPO

Capitalize on opportunities in LNG and hydrogen as part of the global clean energy transition.

Capture the full value-chain across its product lines.

Expanding its standard cryogenic and non-cryogenic equipment business into international markets.

Expanding its large turnkey project business.

Continue to improve operational efficiency and productivity.

Growth through strategic acquisitions and alliances.

Leading Indian supplier and exporter of cryogenic equipment and equipment: exports constituted 62.18% and 45.83% of its revenues from operations in the six months ended September 30, 2023 and in Fiscal 2023.

Large portfolio of specialized cryogenic equipment engineered to global quality standards: Installed Capacity of 3,100 Equivalent Tank Units (which are cryogenic storage tanks of 10,000 litres), 2.4 million disposable cylinders, 14 certifications from United States, Europe, Australia and other international markets.

Diversified domestic and international customer base across industry sectors: 1,201 domestic customers and over 228 international customers.

Strong product development and engineering focus: 419 engineers, appoint scientists of varied experience and expertise at our R&D facility.

Healthy financial performance to support growth.

Its consolidated total income has increased at a CAGR of 27.13% from Rs. 6,089.92 million in Fiscal 2021 to Rs. 9,841.99 million in Fiscal 2023. Its consolidated total income was Rs. 5,799.95 million in the six months ended September 30, 2023.

In the six months ended September 30, 2023, and in Fiscal 2023, Fiscal 2022 and Fiscal 2021, its consolidated profit after tax was Rs. 1,033.37 million, Rs. 1,527.14 million, Rs. 1,304.98 million and Rs. 961.07 million.

Experienced Promoters, Management Team and Skilled Workforce: Employees: 1,016 as on October 31, 2023; 419 engineers and 144 welders. Pavan Kumar Jain: 30 Years of Experience, Siddharth Jain: 18 years of experience, Parag Kulkarni: 30 Years of Experience, Deepak Acharya: 30 Years of Experience.

The company`s business is dependent and will continue to depend on its three manufacturing facilities. The company is subject to certain risks in its manufacturing processes such as the breakdown or failure of equipment and industrial accidents that could lead to interruptions in its business operations, which may, in turn, adversely affect its production schedules, costs and sales and its ability to meet customer demand.

11.56% and 46.52% of revenue from operation was derived from its largest customer and top 10 customers, respectively, for Fiscal 2023. Cancellation by customers or delay or reduction in their orders could have a material adverse effect on its business, results of operations and financial condition.

An increase in its component or raw material costs, or other input costs, may adversely affect the pricing and supply of its products and have an adverse effect on its business, results of operations and financial condition.

The contracts in its Order Book may be adjusted, cancelled or suspended by its customers and, therefore the company`s Order Book is not necessarily indicative of its future revenues or profit.

Cryogen leakage from equipment poses health hazards and its products face inherent risk due high pressures and low temperatures at which many of its cryogenic products are use and the inherent risks associated with concentrated industrial and hydrocarbon gases.

Its manufacturing facilities are located in Gujarat and in in the Union Territory of Dadra and Nagar Haveli exposing it to regulatory and other geography specific risks such as labour unrests, other acts of violence and occurrence of natural and man-made disasters.

The Company does not own the name "INOX" and its inability to comply with the terms and conditions of the Name License Agreement and subsequent termination thereof may adversely impact its business, results of operations and financial condition.

Its exports constituted 62.18% and 45.83% of its revenues from operations in the six months ended September 30, 2023 and in Fiscal 2023, respectively. A slowdown in its exports due to tariffs and trade barriers and international sanctions could adversely affect the company`s business, results of operations and financial condition.

Its may be subject to labour unrest, slowdowns and increased wage costs, which may adversely affect its business, results of operations and financial condition.

Certain of its members of the company`s Promoter Group have not consented to the inclusion of, nor have they provided, information or any confirmations or undertakings pertaining to themselves, which are required to be disclosed in relation to Promoter Group under the SEBI ICDR Regulations in the Draft Red Herring Prospectus, this Red Herring Prospectus and the Prospectus. Consequently, its cannot assure you that the disclosures relating to such members of its Promoter Group are complete or up-to-date.

The company has been unable to locate certain of its historical secretarial and other corporate records. Its may be subject to penalties or adverse actions by authorities in relation to such untraceable records.

The Securities and Exchange Board of India ("SEBI") pursuant to the letter bearing reference number SEBI/HO/CFD/RAC-D IL2/P/OW/2023/32916/1 dated August 14, 2023 ("Exemption Letter"), has granted an exemption under Regulation300(1) of the SEBI ICDR Regulations to the Company from disclosing (i) certain individuals and entities as promoter group under the SEBI ICDR Regulations; and (ii) certain entities as group companies, and providing any disclosures in relation to such companies under the SEBI ICDR Regulations. The exemption granted by SEBI is based on specific circumstances and may not remain valid in case there is any change in such circumstances, which may adversely affect the Offer.

The Company has allotted equity shares to more than 49 persons by way of a preferential allotment in the past. Further, there have been several secondary transactions by its Promoters and members of its Promoter Group in the past.

In the six months ended September 30, 2023, and in Fiscal 2023, Fiscal 2022 and Fiscal 2021, the company used 2,656 suppliers for its key components, materials and stock-in-trade as well as customer support services including product repairs and returns. If any one of its suppliers is unable to deliver its raw materials, components or customer support services in a timely manner, or at all, or meet its design or quality specifications or acceptable prices, its may be unable to meet its product and service delivery timelines.

The markets the company serve are subject to cyclical demand and vulnerable to economic downturn, which could harm its business and make it difficult to project long-term performance.

The company does not have any long term contracts with its third-party suppliers. A failure to maintain the company required supply of raw materials, and any inability on its part to find alternate sources for the procurement of such raw materials, on acceptable terms, could adversely affect its business, results of operations and financial condition.

Any restriction on import of components or raw materials could have an adverse effect on its ability to deliver products to its customers. Further, any increase in export tariff will increase expenses which in turn may impact its business, results of operations and financial condition.

The company could incur losses under its project contracts and purchase orders with the company customers or be subjected to disputes or contractual penalties as a result of cost overruns, delays in delivery or failures to meet contract specifications or delivery schedules which may have a material adverse effect on its business, results of operations and financial condition.

Certain sections of this Red Herring Prospectus contain information from the CRISIL Report which the company commissioned and paid for and any reliance on such information for making an investment decision in the Offer is subject to inherent risks.

Its may not be able to win new projects through the competitive bidding process.

The company will not receive any proceeds from the Offer for Sale. The Selling Shareholders will receive the net proceeds from the Offer for Sale.

Its Promoter and members of the Promoter Group have acquired Equity Shares during the preceding three financial years at a price which may be lower than the Offer Price.

Its may be exposed to potential warranty claims, product recalls and returns, and product liability claims which could adversely affect its business, results of operations and financial condition.

Its operations are subject to environmental and workers` health and safety laws and regulations. its failure to comply with such regulations could lead to enforced shutdowns and other sanctions imposed by the relevant authorities.

The company derived 4.70% and 13.02% of its revenue from operations in the six months ended September 30, 2023 and in Fiscal 2023 from Government Customers (as defined below), which exposes it to risks inherent in doing business with them and may adversely affect its business, results of operations and financial condition.

The company is dependent on its product development and engineering activities for its future success. If the company does not successfully develop new products including cryogenic equipment and systems in a timely and costeffective manner, its business, results of operations and financial condition may be adversely affected.

Its business is concentrated on the Industrial Gas sector. Any factors leading to a decline in the Industrial Gas sector could materially and adversely affect its business, results of operations and financial condition.

The company is subject to strict quality requirements, regular inspections and audits by its customers, and any failure to comply with industry certification standards like PESO may lead to cancellation of existing and future orders and could negatively impact its business, financial condition, results of operations and prospects.

Its may fail to successfully acquire and integrate companies that provide complementary products or technologies.

Its inability to successfully implement some or all of the company`s business strategies in a timely manner or at all could have an adverse effect on its business. Further, its failure to manage growth effectively may adversely impact its business, results of operations and financial condition.

The company is dependent upon the experience and skill of its management team and a number of key managerial personnel. If the company is unable to attract or retain such qualified personnel, this could adversely affect its business, results of operations and financial condition.

The company operate in a competitive environment and may not be able to effectively compete which could have a material adverse effect on its business, results of operations and financial condition.

There are pending legal proceedings against the Company, Promoters, Subsidiaries and certain of its Directors. Any adverse decision in such proceedings may render it/them liable to liabilities/penalties which may adversely affect its business, results of operations and financial condition.

In the six months ended September 30, 2023 and in Fiscal 2023, 62.18% and 45.83%, respectively of its revenue from operations were from exports and 21.84% and 18.51%, respectively, of its raw materials were imported. Accordingly, the company face foreign exchange risks that could adversely affect its results of operations as a portion of its revenue and expenditure is denominated in foreign currencies.

In the six months ended September 30, 2023 and in Fiscal 2023, 36.00% and 29.12%, respectively, of its revenue from operations was from customers in the energy industry. Changes in the energy industry, including pricing fluctuations and reductions and capital expenditures could adversely affect its business, results of operations and financial condition.

Its inability to collect receivables and default in payment from its customers could result in the reduction of the company profits and affect its cash flows.

Demand for cryogenic equipment is expected to be driven by increased demand for cleaner fuels such as compressed natural gas, liquified natural gas and hydrogen. Any studies or market perceptions that suggest that compressed natural gas, liquified natural gas or hydrogen are ineffective or less effective at reducing carbon emissions from conventional energy sources could adversely affect the demand for compressed natural gas, liquified natural gas or hydrogen and demand for its cyrogenic equipment related to these alternative energy sources. Further, increased adoption of electric vehicles could reduce compressed natural gas, liquified natural gas or hydrogen demand.

Under-utilization of its manufacturing capacities and an inability to effectively utilize its expanded manufacturing capacities could have an adverse effect on its business, future prospects and future financial performance.

Its exposure to performance guarantees, could negatively impact its business, results of operations and financial condition.

The company require various regulatory approvals and licenses for the purpose of its business. Its inability to obtain such regulatory approvals and licenses for the purpose of its business in a timely manner or at all, or to comply with the terms and conditions of its existing regulatory approvals and licenses, or maintaining the required filings and registers under such required laws, may have a material adverse effect on the continuity of its business and may impede its effective operations in the future.

Its inability to maintain, protect and enforce the company intellectual property rights, could adversely affect its business, results of operations and financial condition.

Its require working capital for its continued operation and growth. The company`s inability to meet its working capital requirements could have a material adverse effect on its business, results of operations and financial condition.

Its contingent liabilities could materially and adversely affect its business, results of operations and financial condition.

Its business may be adversely affected if the company is unable to maintain and grow its brand image. In particular, its failure to maintain the company quality accreditations and certifications may negatively impact its brand and reputation.

The company has incurred capital expenditure during the last three Fiscal Years and for the period ended September 30, 2023. Its may require financing for its business operations and planned capital expenditure and the failure to obtain additional financing on terms commercially acceptable to it may adversely affect its ability to grow and its future profitability.

Any surplus production on account of inaccurate forecasting of customer requirements and failure to manage inventory could adversely affect its business, results of operations and financial condition.

Its insurance coverage may not adequately protect the company against all losses or the insurance cover may not be available for all the losses as per the insurance policy, which could adversely affect business, results of operations and financial condition.

Failure or disruption of its IT, manufacturing automation systems and/or ERP systems may adversely affect its business, results of operations and financial condition.

The company is dependent on third party transportation and logistics service providers. Any increase in the charges of these entities could adversely affect its business, results of operations and financial condition.

The company does not own certain of the premises of its manufacturing facilities and corporate offices.

Any downgrade of its debt ratings could adversely affect the company`s business.

The company is dependent on third parties for the supply of utilities, such as water, gas and electricity, at its manufacturing facilities and any disruption in the supply of such utilities could adversely affect its manufacturing operations.

The company currently avail benefits under certain export promotion schemes. Any change in these benefits applicable to it or a delay in disbursement of benefits under such schemes may affect its business, results of operations and financial condition.

The company engage contract labour for carrying out certain business operations. Although the company does not engage these labourers directly, Its responsible for any wage payments to be made to such labourers in the event of default by such independent contractors. Any requirement to fund their wage requirements may have an adverse impact on its business, results of operations and financial condition.

Failure to maintain confidential information of its customers could adversely affect its business, results of operations and financial condition as well as damage the company reputation.

An inability to comply with repayment and other covenants in the financing agreements or otherwise meet its debt servicing obligations could adversely affect its business, financial condition, cash flows and credit rating.

Its Subsidiaries, INOXCVA Comercio E Industria De Equipamentos Criogenicos Ltda and INOXCVA Europe B.V. have each taken an unsecured loan from the Company that are repayable on demand and in the event of such a repayment demand, such Subsidiaries may not have adequate funds to make timely payments or at all, which may adversely impact its cash flows and operations of its Subsidiaries.

Its Subsidiaries may not pay cash dividends on shares that its hold in them. Consequently, the Company may not receive any return on investments in its Subsidiaries.

Its employees may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements.

If the company is unable to establish and maintain an effective internal controls and compliance system, its business and reputation could be adversely affected.

Its Promoters, certain of the company Directors and Key Managerial Personnel may have interests other than reimbursement of expenses incurred and normal remuneration or benefits in the Company.

After the completion of the Offer, its Promoter will continue to collectively hold substantial shareholding in the Company.

The company cannot assure payment of dividends on the Equity Shares in the future.

Information relating to the installed manufacturing capacity of its three manufacturing facilities included in this Red Herring Prospectus utilize concepts that are not widely used in the cryogenic equipment industry, and they are based on various assumptions and estimates. Actual production levels and rates may differ significantly from the installed capacity information of its facilities or historical installed capacity information of the company facilities depending on the product type.

The company track certain operational metrics with internal systems and tools. Certain of its operational metrics are subject to inherent challenges in measurement which may adversely affect its business and reputation.

Reliance has been placed on declarations and affidavits furnished by one of its Independent Directors for details of his educational qualifications(s) included in this Red Herring Prospectus.