Senco Gold Files Rs. 400 Crore IPO with SEBI: Expanding Presence and Funding Growth

Senco Gold, a Kolkata-based jeweller, files for a Rs. 400 crore IPO, aiming to expand in north India and grow its diamond jewellery business.

Senco Gold Makes Another Bid for IPO
  • Senco Gold files for an IPO worth Rs. 400 crore, marking its third attempt to go public.
  • The IPO will fund working capital requirements, expand in north India, and grow the diamond jewellery business.
  • Senco Gold derives 85% of its revenue from gold jewellery and 10% from diamond jewellery.
  • The company operates 75 stores and 61 franchise outlets across 96 cities in 13 states and union territories.

Senco Gold, a well-established jewellery player headquartered in Kolkata, is preparing to file an initial public offering (IPO) with the Securities and Exchange Board of India (SEBI). The IPO is valued at Rs. 400 crore and is seen as a significant step in the company's growth strategy. Senco Gold's decision to go public highlights its ambition to expand its operations, strengthen its brand presence, and tap into the capital markets to fund its future endeavours.

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What is the Senco Gold IPO?

The IPO is expected to comprise a fresh issue of Rs. 265 crore, which will provide the company with much-needed funds for its working capital requirements. This infusion of capital will help Senco Gold meet the increasing demand for its products and support its day-to-day operations. The remaining Rs. 135 crore is anticipated to be an offer for sale (OFS), allowing existing stakeholders to sell a portion of their shares. This dual approach will allow the company to raise funds for its expansion plans while also providing an exit opportunity for early investors. IIFL Securities, Ambit Pvt Ltd and SBI Capital Markets Ltd will be managing the IPO issue.

How will the Senco Gold IPO funds be utilised?

The funds generated from the IPO will be strategically allocated to various key areas of the business. One of the primary objectives is to expand Senco Gold's presence in north India. By leveraging the capital raised, the company aims to open new stores, strengthen its distribution network, and enhance its brand visibility in this promising market. Additionally, a portion of the funds will be allocated to the growth of the company's diamond jewellery business, tapping into the rising demand for exquisite diamond pieces.

Senco Gold's revenue stream is predominantly driven by gold jewellery, which contributes approximately 85% of its total revenues. The remaining 10% is derived from diamond jewellery. Senco Gold has built a strong reputation as a trusted jewellery brand in eastern India with an extensive network of 75 stores, complemented by 61 franchise-operated outlets.

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Senco Gold’s strong financials

In 2018, the company filed IPO papers worth Rs. 600 crore, followed by a filing for Rs. 525 crore in 2022. While these attempts did not materialise, Senco Gold has continued to experience notable growth in recent years. In the fiscal year 2022-23, the company reported robust revenue from operations of Rs. 4,075.56 crore, representing a substantial increase from Rs. 3,534.64 crore in the previous fiscal year. Moreover, Senco Gold's profit after tax rose from Rs. 130.15 crore to Rs. 160.91 crore during the same period, reflecting its commitment to profitability and financial stability.

In conclusion, Senco Gold's decision to file for an IPO worth Rs. 400 crore showcases its determination to expand its market presence, strengthen its brand, and leverage capital markets for growth. By allocating funds to its working capital requirements, North India expansion, and diamond jewellery business, the company aims to fuel its future success.

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