Hyderabad-based consumer durable retail chain, Electronics Mart India Ltd has filed its draft red herring prospectus (DRHP) with market regulator, Securities and Exchange Board of India to raise Rs 500 crore through an initial public offering (IPO).
The company intends to utilise the net proceeds to fund its capital expenditure and incremental working capital requirements to the extent of Rs 133.8 crore and Rs 200 cr respectively, repayment/prepayment of Rs 50 crs of its debt besides general corporate purposes.
The company, EMIL, was founded by Pavan Kumar Bajaj and Karan Bajaj as a proprietary concern with a consumer durable and electronics store under the name of ‘M/s Bajaj Electronics’. Today, it stands at number 4 position in India and is one of the fastest growing in the retail of consumer durables and electronics with over 1 crore customers, 7,50,000 square feet of retail space across 90+ stores supported by a strong workforce of over 2600 professionals. Its multi brand outlets operate under the brand names of Bajaj Electronics other than two specialized stores under the name of Kitchen Stories catering to kitchen specific requirements. It is also in the process of setting up another such niche outlet under the name of Audio & Beyond catering to high end audio and home automation solutions, according to a press release.
In line with its cluster focused expansion strategy, it plans to deepen its store network in Andhra Pradesh and Telangana and gradually expand its network in NCR.
EMIL displays more than 6000 stock keeping unit(SKUs) with a focus on large appliances such as air conditioners, televisions, washing machines, refrigerators; mobiles and small appliances besides other IT peripherals across more than 70 consumer durable and electronic brands. It also operates across wholesale and ecommerce channels.
In FY21, the company’s total income stood at Rs 3207.37 crore against Rs 3179.02 crore a year ago. Net profit for the period stood at Rs 58.62 crore versus Rs 81.61crore last year, predominately an impact due to the ongoing pandemic and reduced consumer spending.
As per the CRISIL report stated in the draft document, between FY15-20 its revenue grew at a CAGR of 25.60 percent and as on FY20 its EBITA margins stood the highest amongst its peers.
Anand Rathi Advisors Limited, IIFL Securities Limited and JM Financial Limited are the book running lead managers to the issue.