Kalyan Jewellers To Sell Shares At Rs 86-87 Apiece In IPO
Gold jewelry sits on a counter in a store in Mumbai. (Photographer: Dhiraj Singh/Bloomberg)

Kalyan Jewellers To Sell Shares At Rs 86-87 Apiece In IPO

Warburg Pincus-backed Kalyan Jewellers India Ltd. will sell shares at Rs 86-87 apiece in its initial public offer next week, joining the primary market rush that has extended into 2021.

The proposed Rs 1,175-crore IPO comprises a fresh issue of 9.19 crore shares amounting to Rs 800 crore and an offer-for-sale of 4.31 crore shares amounting to Rs 375 crore from the promoter, TS Kalyanaraman and Highdell Investments Ltd., an investment arm of Warburg Pincus, according to its red herring prospectus. The IPO is set to open on March 16 and close on March 18.

The issue constitutes 13.1% of the company's fully diluted equity and values the jeweller at Rs 8,961.5 crore at the higher end of the price end.

The IPO price is higher than the recent allotment of 9.88 crore equity shares to Highdell at Rs 50.58 on March 4, pursuant to the conversion of 11.90 crore compulsory convertible preference shares held by the private equity arm.

Diversified Presence

The jeweler, which started its operations in Kerala, had 107 showrooms located across 21 states and union territories as of December. 35 of those outlets are in South India, while 30 are located in the Middle East.

According to its prospectus, its operations outside South India contributed 57.69% of its gross profit and 47.81% of its revenue in the financial year ended March 2020. The contribution stood at 49.92% of gross profit and 40.4% of revenue in the nine months ended December 31.

51.29% of Kalyan's FY20 revenue came from outside of Tier-I cities. The contribution rose to 53.08% in the nine months ended December.

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