Warburg To Sell Shares Worth $67m In Indian Gold Retailer Kalyan Jewellers IPO
The company plans to raise ₹1,000 crore in fresh issuance of shares to fund business growth, while its promoter TS Kalyanaraman and private equity firm Warburg Pincus plan to sell shares worth ₹250 crore and ₹500 crore, respectively.
The fresh capital to be raised from the IPO will go towards funding working capital requirements and other general corporate purposes, the company said in its prospectus filed with markets regulator Securities and Exchange Board of India (Sebi).
Warburg Pincus, which holds a 24% stake in the company currently, has so far invested ₹1,700 crore in the jeweller. Warburg first invested in Kalyan Jewellers in 2014, writing a ₹1,200 crore cheque. Later in 2017, the PE investors committed another ₹500 crore to the company.
Investment banks Axis Capital, ICICI Securities and Citi are advising the company on the IPO.
For the year ended 31 March 2020, the jeweller reported Rs10,100.9 crore in revenue from operations, as against the revenue of Rs9,770 crore it reported in the previous financial year. Profit, for the year ending 31 March, came in at Rs142.2 crore, compared to a loss of Rs4.8 crore in the previous year.
Kalyan Jewellers, founded by TS Kalyanaraman, started its jewellery business in 1993 with a single showroom in Thrissur, Kerala. Since then the company has expanded to become a pan-India jewellery company, with 107 showrooms located across 21 states and union territories. It also has an international presence with 30 showrooms located in the Middle East as of 30 June 2020. All of the showrooms are operated and managed by the company.
In FY20, 78.19% of the company’s revenue came from India and 21.81% was from the Middle East.
“Our total showrooms have increased from 77 as of March 31, 2015 to 137 showrooms as of June 30, 2020, and we intend to continue to open additional showrooms as we expect significant opportunity for further penetration in our existing markets as well as in new markets, primarily in India,” the company’s prospectus said.
It also sells jewellery through its online platform ‘candere’.
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