IPO Update: Senco Gold jewellery retailer filed draft papers for an IPO for ₹525 crore

Senco Gold Limited, Eastern India’s largest jewellery retailer, has filed a draught red herring prospectus (DRHP) with capital markets regulator Securities and Exchange Board of India (SEBI) to raise Rs.525 crore through an IPO, according to company sources.

Senco Gold’s IPO consists of a Rs.325 crore fresh issue of equity shares and a Rs.200 crore offer for sale of equity shares from existing private equity shareholder SAIF Partners India IV Limited.

According to the DRHP, the business plans to use 240 crore of the net proceeds from the new issue to meet working capital needs and the rest for general corporate reasons, according to the sources.

In addition, the company may consider a pre-IPO equity share issue of up to 65 crore rupees. If a pre-IPO placement is done, the amount raised from the pre-IPO placement will be deducted from the amount raised from the fresh issuance.

ABOUT SENCO GOLD 

Senco Gold currently operates 127 showrooms in 89 cities and towns in 13 Indian states, 70 of which are owned by the company and 57 of which are franchised. Some of its franchisee showrooms are outside of metros and tier-I areas, giving it a wider reach in tier-2 and tier-3 areas.

Products are also sold through a variety of internet sites. It also sells its jewellery wholesale, particularly to Dubai, Malaysia, and Singapore.

Its operating income increased at a CAGR of 9.92% from Rs.2,420 crore on March 31, 2020 to Rs.2,660 crore on March 31, 2021.

The company has recently entered into a share subscription with Oman India Joint Investment Fund Trustee Company Private Limited, the trustee of Oman India Joint Investment Fund II for the issue and subscription of 26.63 lakh equity shares for an aggregate consideration of Rs.75 crore.

IIFL Securities, Ambit and SBI Capital Markets are the book running lead managers to the IPO. The equity shares of the company are proposed to be listed on BSE and NSE.

SAIF Partners India IV Limited, which has been a shareholder in the company since 2014, will depart through the IPO.

According to the company, the largest jewellery chain in eastern India recently completed a $75 million funding round from another PE fund, Oman India Joint Investment Fund II.