For initial share sales, On Thursday Ethnic apparel retailer Sai Silks (Kalamandir) fixed a price band of Rs 210-222 per share for its Rs 1,201 crore, which opens on September 20.
The Initial Public Offering (IPO) will bring in around Rs 1,201 crore at the top of the price range.
The Hyderabad-based company was founded by Prasad Chalavadi, a techie turned entrepreneur in 2005.
The offer consists of Rs 600 crore of fresh issue and an equal amount of Offer For Sale (OFS) through which the promoter family will divest 30 per cent of their 95.5 per cent shareholding, Chalavadi said.
The remaining 4.5 per cent of the bootstrapped ethnic retailer of premium and mid-income women’s wear primarily sarees, are with the employees, he added.
The floor price and cap price are 105 times and 111 times the face value of the shares, respectively, at a price band of Rs 210 per share.
The OFS comprises promoters and some of the employers selling up to 2.70 crore equity shares.
Nagakanaka Durga Prasad Chalavadi, Jhansi Rani Chalavadi, Dhanalakshmi Perumalla, Doodeswara Kanaka Durgarao Chalavadi, Kalyan Srinivas Annam, Subash Chandra Mohan Annam and Venkata Rajesh Annam are the selling promoters.
Post issue, the promoters will hold 60 per cent of equity in the company, which has 54 showrooms across Telangana, Andhra Pradesh, Karnataka and Tamil Nadu.
Chalavadi said a portion of the IPO proceeds will be used to open 30 more stores in Tamil Nadu, which is its focus market now. Each store on average will involve around Rs 2.5 crore of capex, leading to an outgo of Rs 125 crore.
Qualified institutional buyers will receive 50% of the issuance, followed by non-institutional investors receiving 15% and retail investors receiving the remaining 35%. A maximum of 60% of the QIB portion may be allocated to anchor investors.
In fiscal 2023, Sai Silks posted revenues of Rs 1,351 crore with a net profit of Rs 97.6 crore.
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