Ethnic apparel retailer Sai Silks (Kalamandir) Ltd has announced the opening of its initial public offering (IPO) for subscription on Wednesday, September 20, 2023. The Hyderabad-based saree retailer's IPO will remain open for three days, until Friday, September 22, 2023. The allotment for the IPO is expected to be finalized on Wednesday, September 27, 2023, with the company's equity shares tentatively listed on the BSE and NSE on Tuesday, October 4, 2023.
The IPO comprises a fresh issuance of 2.7 crore (1 crore = 10 million) shares worth Rs 600 crore and an Offer for Sale (OFS) of 2.70 crore equity shares by promoters' selling shareholders. This marks a revision from the original OFS size of 1.80 crore equity shares. The total issue size, at the upper end of the price band, comes in at Rs 1,200 crore.
The price band for the IPO has been fixed at Rs 210 to Rs 222 per equity share. Of the total offering, half has been reserved for qualified institutional buyers, with a further 15 percent set aside for non-institutional investors and the remaining 35 percent for retail investors.
The net proceeds from the fresh issue will be used for various purposes by Sai Silks (Kalamandir) Ltd. Up to Rs 125 crore will fund capital expenditure towards setting up 30 new stores and up to Rs 25 crore will be used for establishing two warehouses. The company also plans to allocate up to Rs 280 crore for funding working capital requirements and up to Rs 50 crore for repayment or pre-payment of certain borrowings. Any remaining funds will be used towards general corporate purposes.
Sai Silks (Kalamandir) Ltd operates four store formats – Kalamandir, VaraMahalakshmi Silks, Mandir, and KLM Fashion Mall -- offering products to various segments of the market that include premium ethnic fashion, ethnic fashion for middle income, and value-fashion. As of July 31, 2023, the company has a network of 54 stores across four major south Indian states - Andhra Pradesh, Telangana, Karnataka, and Tamil Nadu.
The book-running lead managers to the issue are Motilal Oswal Investment Advisors Ltd, HDFC Bank Ltd, and Nuvama Wealth Management Ltd.
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