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The 1st Jeweller IPO of 2021 : Kalyan Jewellers IPO And Key Highlights

Kalyan Jewellers is the premium jewellery store for every Indian. It is among the largest jewellery companies in India. The company manufactures, designs and sells a variety of silver, gold and platinum jewellery. It also makes ornaments consisting of diamonds and rubies. The company is a premium visiting shop for every festival of Indians. The company functions in more than 21 states in India.

Today the company has more than 107 outlets in India It also has a big market in the Middle east. The company has more than 30 Stores located at different locations there. Kalyan Jewellers generates its major income from selling gold ornaments and jewelleries.

The company has multiple brands under it :

ANOKHI
MUDRA
NIMAH
RANG
TEJASVILAYA
GLO
ZIAH
VEDHA
CANDERE
APOORVA
HERA

The firm manages all these brands under its parent company KALYAN JEWELLERS.

Kalyan Jewellers IPO Details

The Kalyan Jewellers IPO kicks in on 16th March, 2021. The DEMAT account holders can subscribe to the IPO from 16th March, 2021 till 18th March, 2021. The IPO is a book built issue and the face value decided per share is 10 Rs. Also the price band determined is 86 to 87 rs per share. The minimum no of shares per lot are 172 shares. This amounts to approximately 14960 Rs. The maximum lots that a person can opt for are 13. In 13 lots the number of shares issued will be 2236 and the value for the shares is Rs. 194530 approximately.

The issue is set to raise 1175 Crore Rs from Dalal street. Out of the entire issue offer for sale consists of 375 Crore rs and Fresh issue consists of Rs. 800 Crore. The listing for the shares is to be done at both the exchanges BSE and NSE. The listing date is set on 26th March, 2021. The registrar for the company is Link Intime India Private Limited.

Tabular Representation of IPO Details

IPO OPENING DATE	March 16, 2021
IPO CLOSING DATE	March 18, 2021
ISSUE TYPE	Book Built Issue
Face Value per share	Rs. 10 per share
IPO price band	86 to 87 Rs. per share
LOT SIZE	172 shares
MINIMUM ORDER QUANTITY	172 shares
ISSUE SIZE	1175 crore Rs.
OFFER FOR SALE	375 Crore Rs.
FRESH ISSUE	800 Crore Rs.
LISTING AT	BSE, NSE
LISTING DATE	26th March, 2021

Important Dates

IPO OPENING DATE	16th March, 2021
IPO CLOSING DATE	18th March, 2021
IPO ALLOTMENT DATE	23rd March, 2021
REFUNDS	24th March, 2021
DEMAT A/C CREDITED ON	25th March, 2021
IPO LISTING DATE	26th March, 2021

The IPO would hit the Dalal Street on 26th March, 2021. The procedure before that initiates on 16th March, 2021. The IPO subscription begins on that day. The subscription period would conclude on 18th March, 2021. The allotment status would be finalised on 23rd March, 2021. The refunds for the shareholders not getting allomtement would start on 24th March, 2021. The DEMAT accounts of shareholders would be credited with the shares on 25th March, 2021.

Promoter and Lead Managers

There are three major promoters for the firm. They are :

T.S. KALYANARAMAN
T.K. RAMESH
T.K. SEETHARAM

Also the company’s stake holding for promoter pre IPO launch is 76%.

The lead managers for the IPO are :

Axis Capital Limited
CitiGroup Global Markets India limited
SBI Capital Markets Limited
ICICI Securities Limited
BOB Capital Markets Limited

Objectives for the Kalyan Jewellers IPO

The objectives behind the public issue are :

The company has a shortfall of working capital. The liquidity of the company has taken a hit due to the recent loss as well as unstable financial position. The company wants to maintain its daily production facilities along with servicing facilities at multiple outlets. Hence the company is planning to get public money for smooth functioning of daily work.
The money from IPO issues can also be utilized for meeting the general corporate expenses of the company.

Company Financials

Particulars (in Million Rs.)	2019-20	2018-19	2017-18
ASSETS	82187	80600	85510
REVENUE	101810	98140	105892
NET PROFIT	1422.75	(48.47) LOSS	1410

The company is struggling currently in placing itself in line with its competitors. The company has high liquidity requirements which could be seen in its objectives. Also the company has decreasing net assets which is not a good sign for any company trying to expand or develop. The revenues are also shrinking every year.

The company initially had assets worth 85500 Million Rs nearly which reduced by 5000 Million Rs. This displays red flags for the company. Even after sale of assets and reduction in outstanding debtors the company reported a loss in the same year (2018-19). This shows that the company’s performance is not in line with its resources. The company showed great results again in 2019-20 with the profits registering at 1422.75 million Rs.

But this may also be the effect of Gold reaching to 50000 Levels Pre-COVID time and during the lockdown situations. Kalyan Jewellers does not only sell ornaments but also manufactures them. So the company has a high stock of gold daily in its storage. This accounts to high gold reserves. Hence the company would have definitely benefited from the price rise in the time of COVID situation.

Net Profits and Revenue in 2020-21

The financial figures till Dec, 2020 indicate that the company has again failed in its operations and has suffered from a heavy loss until that quarter. The loss amounted to Rs. 800 Million Rs. The revenue has accrued to almost 56000 Million Rs and the assets have been decreased to Rs. 81000. This means that the company is constantly reducing its assets and not registering profits.

The finance figures for the company are very vague and unstable. Hence one needs to wait for another year to plan for any long term investments in the company. The reason is it’s important to watch the utilization of IPO money and company’s growth with it. After that only one can make a decision to either invest or not in the company.

Pros

The company has international business
Kalyan Jewellers has more than 107 outlets in India and has more than 30 outlets in the Middle East as well. So the company has many outlets to sell its high quality product.
The company has high reserves of gold and should have benefitted from the price rise of Gold recently this year.
Diversified product portfolio with multiple brands.
The company produces and sells its ornaments so it is not dependent on any third party for its products.

Cons

The financial data of the company is vague and unclear. The financial position is highly unstable and the company has a shortage of liquidity as well. This means that the company is vulnerable for long term investment plans at this point of time.