Auto-components maker Rolex Rings Ltd has filed preliminary papers with capital markets regulator Sebi to launch an initial share sale. So far this year, 16 companies have filed draft papers for their respective initial public offers (IPOs) as these firms are expecting to benefit from an equity market which is flush with liquidity and has seen a sharp increase in new retail investors.
Moreover, as many as 15 companies have already come out with their initial share-sales so far in 2021. Rolex Rings’ IPO comprises fresh issue of shares worth Rs 70 crore and an offer for sale of up to 65 lakh equity stocks by Rivendell PE LLC (formerly known as NSR-PE Mauritius LLC), according to the draft red herring prospectus (DRHP). Currently, Rivendell holds 45.51 per cent stake in Rolex Rings.
Proceeds from the fresh issue would be used towards funding long-term working capital requirements as well as general corporate purposes. In addition, the auto component maker expects to receive the benefits of listing of the equity shares on the stock exchanges, enhancement of its brand name amongst existing and potential customers and creation of a public market for its equity shares in India.
Based at Rajkot in Gujarat, Rolex Rings is among the leading manufacturers of forged and machined components in the country. For the six months ended September 2020, the company posted a profit of Rs 25.31 crore and its revenue from operations stood at Rs 224.52 crore.
For the fiscal year ended March 31,2020, Rolex Rings reported a profit of Rs 52.94 crore as compared to Rs 59.04 crore in the preceding fiscal. Its revenues from operations was at Rs 666 crore in fiscal year ended March 31,2020 as against Rs 904.32 crore in the last financial year.
“The continuing impact of the outbreak of the COVID-19 could have a significant effect on our operations, and could negatively impact our business, revenues, financial condition, cash flows and results of operation,” according to the draft papers.
Equirus Capital Private Ltd, IDBI Capital Markets & Securities Limited, JM Financial Limited have been appointed as merchant bankers for the issue. The equity shares of the company will be listed on the BSE and NSE.