The Rs 439.5 crore Knack Packaging IPO witnessed strong demand on its third and final day of bidding, with the issue being subscribed 8.34 times against the 1.89 crore shares on offer. The retail investor portion was booked 4.63 times, indicating steady participation from individual investors.

Investor sentiment remains upbeat. In the grey market, Knack Packaging shares are trading at a premium of around 17% over the upper end of the price band, suggesting the potential for a healthy listing gain if current trends continue.

The IPO comprises a fresh issue of Rs 380 crore and an offer for sale (OFS) of up to Rs 59.5 crore by existing shareholders. The company has fixed the price band at Rs 161-170 per share, with a minimum application size of 88 shares.

Knack Packaging is set to list on both the BSE and NSE, with the tentative listing date scheduled for July 8.

As of Day 3, 10:05 AM, the Knack Packaging IPO had been subscribed 8.34 times overall, against 1.89 crore shares on offer.

Retail Individual Investors (RIIs): Subscribed 4.63 times for their allotted 94.42 lakh shares, reflecting steady retail participation.

Non-Institutional Investors (NIIs): Saw strong demand, getting subscribed 23.53 times against 40.46 lakh shares, highlighting robust HNI interest.

Qualified Institutional Buyers (QIBs): Subscribed 3.48 times for 40.46 lakh shares, indicating moderate institutional demand.

Sentiment in the grey market remains upbeat for the Knack Packaging IPO, with shares trading at a grey market premium (GMP) of around 17% over the upper price band.

Based on current GMP trends, the IPO is expected to list near Rs 198 per share, suggesting a potential listing gain if market sentiment holds steady.

Knack Packaging is an integrated packaging solutions manufacturer engaged in producing Printed and Laminated Woven Polypropylene (PLWPP) bags, including pinch-bottom bags used across industries such as food grains, flour, sugar, pet food, fertilizers, chemicals, detergents, cement and construction materials.

The company exports to 71 countries and serves over 1,950 customers globally. It has an estimated 10.1% market share in India's flexible bulk PLWPP bags segment and operates an integrated manufacturing model covering the entire production chain from polypropylene processing to printing and bag conversion.

Its customer base includes companies such as KRBL, Drools, DCM Shriram, Baba Agro Foods, while internationally it serves clients including Cargill and other global brands.
Financial performanceFor FY26, the company reported revenue from operations of Rs 823.4 crore, up from Rs 736.5 crore in the previous year.

Net profit increased to Rs 92.8 crore from Rs 73.8 crore in FY25, while EBITDA improved to Rs 152 crore, with EBITDA margins expanding to 18.5%.Utilisation of proceedsThe company plans to use the fresh issue proceeds primarily to fund the construction of a new manufacturing facility at Borisana in Gujarat, with around Rs 320 crore earmarked for capital expenditure. The remaining proceeds will be used for general corporate purposes.
What brokerages sayChoice Broking has assigned a "Subscribe for Long Term" rating to the IPO.

The brokerage believes Knack Packaging has built a strong competitive position through its integrated operations, export presence and consistent financial performance. It expects the company's ongoing capacity expansion, shift towards owned manufacturing facilities and international growth initiatives, including its Mexico joint venture, to support long-term earnings growth.

However, Choice also highlighted risks from global economic slowdowns, customer concentration, foreign currency fluctuations and competitive pressures.

Anand Rathi has also recommended "Subscribe -- Long Term" on the issue.

The brokerage believes the company is well positioned in the organised packaging industry with an integrated manufacturing model, strong export presence and growing demand for value-added packaging products. It also noted that increasing manufacturing capacity and improving operational efficiencies could support future growth.

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At the upper end of the price band, the IPO is valued at around 22.4 times FY26 earnings, which both brokerages consider broadly fair considering the company's growth profile and export-led business model.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)