Manoj Vaibhav Gems 'N' Jewellers IPO: All You Need To Know
The company plans to raise Rs 270 crore via IPO at a fixed price band of Rs 205-215 per share. It opens on Sept. 22
Manoj Vaibhav Gems 'N' Jewellers Ltd. will launch its initial public offering on Sept. 22. The South Indian regional jewellery brand plans to raise up to Rs 270.20 crore via a fresh issue and offer for sale.
The fresh issue will be worth a total of Rs 210 crore, while the offer for sale will be worth Rs 60.20 crore. The price band is fixed in the range of Rs 204–215 per share.
In the OFS segment, promoter Grandhi Bharata Mallika Ratna Kumari (HUF) will be the sole selling shareholder and will offload a total of 28 lakh shares.
Out of the total IPO size, 50% is reserved for qualified institutional buyers, 15% for non-institutional investors, and the remaining 35% is to be allotted to retail individual investors.
Issue Details
Issue opens: Sept. 22.
Issue closes: Sept. 26.
Total issue size: Rs 270.20 crore
Fresh issue size: Rs 210 crore.
OFS size: Rs 60.20 crore
Face value: Rs 10 apiece.
Fixed price band: Rs 204–215 per share.
Minimum lot size: 69 shares.
Listing: NSE, BSE.
Use of Proceeds
To finance the set up of the proposed eight new showrooms.
(a) Estimated capital expenditure: Rs 12 crore.
(b) Estimated inventory cost: Rs 160.02 crore.
General corporate purposes.
Out of the Rs 12 crore estimated for the capital expenditure for setting up the new showrooms, Rs 3 crore is estimated to be deployed in FY24, while the balance of Rs 9 crore is estimated to be deployed in FY25.
Out of the Rs 160 crore estimated for the inventory cost for setting up the new showrooms, Rs 40 crore is estimated to be deployed in FY24, while the balance of Rs 120 crore is estimated to be deployed in FY25.
Business
Manoj Vaibhav Gems 'N' Jewellers, also known as Vaibhav Jewellers, is a regional jewellery brand in South India. Incorporated in 2003, the company offers a range of gold, silver, and diamond jewellery along with precious gemstones.
The company has a presence in the micromarkets of Andhra Pradesh and Telangana and conducts business via their website and their 13 showrooms, inclusive of two franchisees, spread across eight towns and two cities. The company had a 4% market share of the overall Andhra Pradesh and Telangana jewellery markets and a 10% market share of the organised market in these two states in FY23, according to a Technopak report.
The company caters to all the economic segments of the micromarkets of Andhra Pradesh and Telangana and has a strong rural market and urban focus. In line with the company's beliefs that rural markets have a larger share of the retail jewellery space, 77% of the company's showrooms are in Tier 2 and Tier 3 cities than the rural market.
As of FY 2023, gold jewellery accounted for the majority of the company's total revenues at 89.23%, followed by diamonds at 4,06% and silver jewellery at 3.96%.
Risk Factors
The non-availability or high cost of quality gold bullion, silver, diamonds, and other precious and semi-precious stones has an impact on the business.
All the existing and proposed retail showrooms of the company are present in only two states: Andhra Pradesh and Telangana. Any changes in the political and economic situations in the states could affect business.
There are Rs 150 crore worth of pending material litigation proceedings related to the company.
Fluctuations in the price of gold, silver, etc. will have a direct impact on the revenue and margins of the company.
Except for their flagship showroom, all other retail shops owned by the company are leased properties. The inability to renew or negotiate the leasing agreements will lead to significant disruptions in operations.
Watch | Vaibhav Jewellers' management speak to BQ Prime:
