Senco Gold Limited, a pan-India jewellery retail player with a five-decade history and the second most trusted jewellery brand according to the TRA’s Brand Trust Report 2020, has filed a draught red herring prospectus (DRHP) with capital markets regulator SEBI to raise Rs. 525 crore through an initial public offering (IPO). According to an official, Senco Gold’s Initial Public Offering consists of a fresh issuance of equity shares worth up to Rs. 325 crore and an offer for sale of equity shares worth up to Rs. 200 crore by selling shareholder SAIF Partners India IV Limited. The business intends to use Rs. 240 crore of the net proceeds from the new issuance to fund working capital requirements, with the remaining funds going to general corporate purposes.
In addition, the firm may pursue a Pre-IPO placement of up to Rs. 65 crore in equity shares. The amount raised from the Pre-IPO Placement will be deducted from the Fresh Issue if the Pre-IPO Placement is completed. Senco Gold Limited, established in Kolkata and operating under the trade name ‘Senco Gold & Diamonds,’ is the largest organised jewellery retail player in the eastern area of India, according to a CRISIL report. It also has the largest geographical impact in non-eastern states among eastern India’s jewellery shops. The firm mostly sells gold and diamond jewellery, but also silver, platinum, precious and semi-precious stones, and other metals are available.
Senco Gold now operates 127 showrooms (70 Company Operated Showrooms and 57 Franchisee Showrooms) in 89 cities and towns throughout 13 Indian states, with a total size of roughly 393,342 sq. ft. Some of its franchisee Showrooms are outside of metros and tier-I cities, giving it a wider reach in tier-2 and tier-3 areas. The firm is working to strike the right mix between owning Showrooms and growing its asset-light franchise strategy. It aims to establish a presence in the state capital or major city through Company Operated Showrooms before expanding into tier-II and tier-III regions in the state, mostly through franchisee showrooms, to maximise inventory logistics and return on capital.
The Company recently agreed to issue and subscribe for 26,63,541 Equity Shares for an aggregate price of Rs. 75 crore with Oman India Joint Investment Fund Trustee Company Private Limited, the trustee of Oman India Joint Investment Fund II. IIFL Securities Limited, Ambit Private Limited, and SBI Capital Markets Limited are the offer’s Book Running Lead Managers. The equity shares will be listed on the BSE and NSE.
