Kerala-based retail jeweler Joyalukkas India has submitted its draft red herring prospectus (DRHP) to the market regulator Securities and Exchange Board of India (SEBI) to raise Rs 2,300 crore through an initial public offering (IPO) with a new issue of shares, with no offer to sell component .
The issue has a face value of Rs 10 per share for the proposed share sale. The offer will be made through the bookbuilding process, with no more than 50 percent of the offer available for allocation to Qualified Institutional Buyers, no less than 15 percent of the offer available for allocation to Non-Institutional Bidders and no less than 35 percent of the supply is available for allocation to individual private bidders.
Joyalukkas jewelry business includes the sale of gold jewelry, stud jewelry and other jewelry products including diamonds, platinum, silver and other precious stones. It is present in numerous regions of India, with a focus on the southern states.
As of September 30, 2021, 93.33 percent of operating revenue comes from the Southern Region, followed by 3.37 percent from the West. The company also intends to open eight new showrooms in Telengana, Maharashtra, Odisha and Karnataka over the next two years.
The proceeds from the re-issuance are valued at Rs 1,400 crore to repay or prepay loans in whole or in part of all or certain loans to the company and Rs 463.90 crore to fund the opening of eight new showrooms alongside general corporate purposes.
It was founded by promoter and general manager Alukkas Varghese Joy who has over 33 years of experience in the jewelery industry. It began operations in 2002 with the opening of a showroom in Kottayam, Kerala and has since expanded to a network of 85 showrooms under the Joyalukkas brand, covering 68 cities in India totaling approximately 344,458 square feet ( Status: January 31). 2022.
Of these 85 showrooms, 6 are large format showrooms with an area of 8,000 square feet or more including the largest showroom in Chennai, Tamil Nadu which has an area of over 13,000 square feet. It has a selection of over 100,000 jewelry designs in various price ranges and caters to customers in all market segments. It currently has film actress Kajol hired as a celebrity brand ambassador.
Jewelery is divided into four categories: gold jewellery, diamond jewellery, silver jewellery, platinum and other precious metal/stone jewellery, and platinum and other precious metal/stone jewellery. Traditional, contemporary and hybrid designs are included in the product profile across jewelry lines, uses and price points, reflecting regional consumer preferences and designs. Products are also sold under eight sub-brands, including Pride, Eleganza, Veda, Apurva, Ratna, Zenina, Masaaki Beads and Li’l Joy. are designed to cater to specific customer niches such as classic jewellery, contemporary jewellery, and Polki diamond and gemstone jewellery, and undergo rigorous quality control including various official and other tests for different pieces of jewellery. The products are suitable for a variety of situations, from everyday casual wear to attire for special occasions such as weddings or festivals.
To cater to younger and more tech-savvy customers, the jeweler launched its online portal www.joyalukkas.in in March 2018, allowing customers to browse the platform’s library based on their preferences, collections and designs, then buy and have it delivered through a Partnering with third-party logistics companies home.
It also offers pre-purchase programs on its online platform through the Easy Gold program, where customers can schedule the purchase of gold jewelry in fixed monthly installments starting at $1,000 up to ten months in advance at the current gold rate and ultimately receive their purchase at their doorstep .
Joyalukkas reported a profit of Rs.471.75 crore in FY21 compared to Rs.40.71 crore last year. Operating income rose 0.53 per cent from Rs 8,023.79 crore in FY2020 to Rs 8,066.29 crore in FY2021, driven by an increase in retail sales and other operating income following the end of COVID-19.
It recorded the highest EBITDA per square foot in FY21 and ranked among the highest PAT among top players in India, according to a Technopack report commissioned by the company. The net debt to equity ratio has decreased from 1.04 in 2019 to 0.77 as of September 30, 2021
Profit for the six-month period ended September 2021 was Rs. 268.95 crore on sales of Rs. 4,012. 26 crores.
The size of India’s jewelry retail sector was nearly US$60 billion (Rs.4.58 trillion) in FY2020 and is forecast to grow at a CAGR of 9 percent to US$91 billion (June 6) by FY2025 .94 trillion rupees) will rise. However, organized jewelry retail would grow faster at a CAGR of around 14 percent from US$19 billion (Rs.1.45 trillion) in FY2020 to US$36 billion (Rs.2.75 trillion) in FY2025. Organized jewelry retail’s share of the overall jewelry market is expected to increase from 32% in FY2020 to 40% in FY2025.
Edelweiss Financial Services Limited, Haitong Securities India Private Limited, Motilal Oswal Investment Advisors Limited and SBI Capital Markets Limited are the lead bookers of the offering.
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Published on: Monday, March 28, 2022 12:23 PM IST