RK Swamy files for IPO, first by an integrated marketing services group

The offer for sale comprises up to 1,788,093 equity shares by Srinivasan K Swamy, Up to 1,788,093 equity shares by Narasimhan Krishnaswamy, Up to 4,445,714 equity shares by Evanston Pioneer Fund L.P. and Up to 678,100 equity shares by Prem Marketing Ventures LLP.

RK Swamy Limited, the largest Indian majority-owned integrated marketing services provider offering a single-window solution for creative,a media, data analytics and market research services, has filed its draft red herring prospectus with market regulator SEBI. The initial public offering of the firm, which gained popularity as an ad agency, comprises a fresh issue of aggregating up to Rs 215 crore and an offer for sale of up to 8,700,000 equity shares by selling shareholders.

On April 6, 2023, Moneycontrol was the first to report the listing plans of RK Swamy. The report had added that the proposed IPO would be a combination of primary and secondary issuance of shares and would facilitate growth capital.

If the listing plans of the company fructify, it would be the first ever IPO in India by a major integrated marketing services group.

The company was established by the late founder RK Swamy (referred to as the 'Grand Old Man of Indian Advertising' by Sam Balsara) who started RK SWAMY Advertising Associates in Chennai in 1973.

The offer for sale comprises up to 1,788,093 equity shares by Srinivasan K Swamy, Up to 1,788,093 equity shares by Narasimhan Krishnaswamy, Up to 4,445,714 equity shares by Evanston Pioneer Fund L.P. and Up to 678,100 equity shares by Prem Marketing Ventures LLP.

The funds raised through the IPO are proposed to be utilized for the funding of working capital, the funding of capital expenditure to be incurred for setting up a digital video content production studio, the funding of investment in IT infrastructure development of RK Swamy Limited, and the material subsidiaries, Hansa Research and Hansa Customer Equity, the funding of the setup of a new customer experience centres and computer aided telephonic interview centres as well as for general corporate purposes.

The integrated marketing communications business segment of RK Swamy includes creative and digital content, media (including digital), events and activation planning, buying and executing; and others including public relations, social media management, and pharmaceutical communication.

During Fiscal 2023, RK Swamy Limited released over 818 creative campaigns on behalf of clients across various media outlets, handled over 97.69 terabytes of data and has conducted over 23.7 lakh consumer interviews across quantitative, qualitative and telephonic surveys.

The solutions and offerings are serviced by over 2,391 employees spread across 12 offices and 12 field locations across twelve cities, across the three business segments. SBI Capital Markets Limited, IIFL Securities Limited and Motilal Oswal Investment Advisors Limited are the Book Running Lead Managers to the issue.

In July 2022, RK Swamy and BBDO (a leading network of the global Omnicon group) announced parting of ways after an alliance that lasted 37 long years. Under a new agreement, RK Swamy bought out BBDO’s stake in the joint entity and BBDO bought out R K Swamy’ stake in BBDO India.

"The reason why we decided to go our separate ways was to integrate our offerings (RK Swamy Hansa Group) as one," Srinivasan Swamy, chairman and managing director of RK Swamy Hansa Group, told Storyboard18 in an interview dated July 12, 2022. Sibling Shekar Swamy is the Group CEO.