PN Gadgil Jewellers Files for ₹1,100 Crore IPO to Expand Presence

28 Mar 2024 , 11:43 AM

Pune-based jewellery retailer PN Gadgil Jewellers has submitted documents to the Securities and Exchange Board of India (SEBI) to raise ₹1,100 Crore through an initial public offering (IPO).

The IPO comprises a combination of a fresh issue of equity shares worth ₹850 Crore and an offer-for-sale (OFS) of ₹250 Crore worth of shares by promoter SVG Business Trust.

PN Gadgil Jewellers plans to allocate ₹387 Crore of the fresh issue proceeds towards establishing 12 new stores in Maharashtra by FY26, while ₹300 Crore will be earmarked for debt repayment. The remaining funds will be utilized for general corporate purposes.

As of February 29, the company’s debt stood at ₹377.45 Crore.

Claiming to be the second largest organised jewellery player in Maharashtra by the number of stores, PN Gadgil operates 33 stores, with 32 located in Maharashtra and Goa, and one in the US. While 23 stores are operated and managed directly by the company, 10 are franchisee-owned and operated.

Competing with prominent names like Kalyan Jewellers India, Senco Gold, and Thangamayil Jewellery, PN Gadgil Jewellers recorded a robust 34.8% year-on-year growth in net profit, amounting to ₹93.7 Crore for FY23. However, the operating margin experienced pressure due to elevated input costs.

In terms of revenue, the company achieved ₹4,507.5 Crore for FY23, marking a significant 76.4% increase over the previous year. EBITDA saw a 10.3% rise to ₹122.7 Crore, but the margin dropped by 163 basis points to 2.72% during the same period.

For the six months ending September FY24, net profit stood at ₹43.75 Crore on revenue of ₹2,627.8 Crore.

Motilal Oswal Investment Advisors, Nuvama Wealth Management, and BOB Capital Markets have been appointed as merchant bankers to manage the IPO.