Raymond-promoted JK Files & Engineering has filed draft red herring prospectus with the capital markets regulator Sebi to raise funds via initial public offering.
The company is planning to raise Rs 800 crore through its public issue that comprises entirely an offer for sale by the promoter Raymond. Hence the company will not get any money from public issue and all the money will go to selling shareholder.
The offer will include reservation of shares for employees and shareholders.
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JK Files is engaged in the business of manufacturing of precision engineered components for tools and hardware such as steel files and drills, and marketing, sale and distribution of hand tools, power tool accessories and power tool machines. Its subsidiary RPAL also manufactures auto components and engineering products such as ring gears, flexplates and water pump bearings.
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The company claimed that they have a strong customer focus. Its customer base comprises business-to-business (B2B) customers as well as business-to-consumer (B2C) customers spread in more than 60 countries, as of June 2021, located across Asia-Pacific, Africa, Latin America, Europe and North America.
JK Files clocked significant growth in consolidated profit at Rs 25.57 crore in the financial year FY21, compared to Rs 14.3 crore on strong operating income, but revenue fell to Rs 344.25 crore from Rs 375.98 crore in the same period.
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Profit in the three-month period ended June 2021 stood at Rs 9.6 crore on revenue of Rs 110.47 crore.
SBI Capital Markets, DAM Capital Advisors, and HDFC Bank are the book running lead managers to the offer.
Earlier this month, promoter had said, "JK Files IPO will help deleverage Raymond. Post-IPO, it would continue to remain Raymond's material subsidiary."
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