At a time when the IPO market has been struggling with weak listings and disappointing post-listing performances, KRN Heat Exchanger & Refrigeration Ltd has emerged as a standout outperformer. Listed in October 2024, the company has scripted a remarkable success story, bucking the broader weakness seen across the primary market.
The company, which manufactures and exports aluminium and copper fin-and-tube heat exchangers, condenser coils and evaporator units, has delivered extraordinary returns to investors since its stock market debut.
What makes the rally even more notable is the sharp appreciation from its IPO price band. Despite subdued sentiment in the IPO market, KRN Heat Exchanger shares are currently trading over 400 per cent above their issue price, making it one of the biggest wealth creators among recent IPO listings.
Strong Q4FY26 earnings back stock rally
The company’s stellar stock market performance has been supported by robust financial growth.
In its latest quarterly results, KRN Heat Exchanger reported a 36.5 per cent year-on-year rise in revenue to Rs 179 crore, compared with Rs 131.5 crore in the corresponding quarter last year.
EBITDA surged 77.2 per cent YoY to Rs 33.5 crore from Rs 19 crore, while profit after tax (PAT) increased 57.2 per cent to Rs 23.4 crore versus Rs 14.8 crore a year ago.
| Metric | Q4FY26 | YoY Growth |
| Revenue | Rs 179 crore | 36.5% |
| EBITDA | Rs 33.5 crore | 77.2% |
| PAT | Rs 23.4 crore | 57.2% |
| EBITDA Margin | 18.7% | +429 bps |
Margin trajectory remains strong
The company has also maintained a strong margin trajectory over the last few quarters.
EBITDA margins improved from 14.4 per cent in Q4FY25 to 15.7 per cent in Q1FY26, 19.7 per cent in Q2FY26 and 20.3 per cent in Q3FY26, before moderating slightly to 18.7 per cent in Q4FY26.
| Quarter | EBITDA Margin |
| Q4FY25 | 14.4% |
| Q1FY26 | 15.7% |
| Q2FY26 | 19.7% |
| Q3FY26 | 20.3% |
| Q4FY26 | 18.7% |
The company also reported a sharp improvement in profitability, with EBITDA margin expanding 429 basis points year-on-year to 18.7 per cent from 14.4 per cent.
Operational momentum stays robust
On the operational front, KRN Heat Exchanger continued to witness strong momentum.
The company’s inventory cover currently stands at around 2.5 months, along with nearly 20 days of goods in transit. During the fourth quarter, the company added 10-15 new bus customers and is targeting the addition of over 70 new customers in FY26.
The company is also expanding its presence across newer segments, including data centres, exports and bus AC OEMs.
Further strengthening its growth outlook, KRN Heat Exchanger said its new HVAC manufacturing facility has now become operational.
FY27 outlook remains strong
From an outlook perspective, the company expects a significant scale-up in operations in FY27, with capacity utilisation projected to rise to around 50 per cent from nearly 20-25 per cent in FY26.
Management is also targeting nearly Rs 160 crore revenue from the bus AC segment in FY27, while exports are expected to contribute around 30-50 per cent of the company’s overall revenue mix.
In addition, the company expects approvals under the PLI and RIPS schemes during FY27, which could further support its long-term growth trajectory.
| Key Metric | FY27 Outlook |
| Capacity utilisation | Around 50% |
| FY26 capacity utilisation | Nearly 20-25% |
| Bus AC revenue target | Around Rs 160 crore |
| Export contribution | 30-50% of revenue |
| PLI & RIPS approvals | Expected in FY27 |
While several newly listed companies have struggled to sustain gains after listing, KRN Heat Exchanger has managed to deliver strong financial growth, margin expansion and operational scale-up alongside sharp stock price appreciation.
The company’s expanding presence in exports, data centres and bus AC OEMs, coupled with rising capacity utilisation and government incentive expectations, could keep the stock in focus going ahead.
(Disclaimer: The above article is meant for informational purposes only, and should not be considered as any investment advice. ET NOW DIGITAL suggests its readers/audience to consult their financial advisors before making any money-related decisions.)
