The IPO bell rings for Rolex Rings, an auto component manufacturer based in Rajkot, Gujarat. They are among the top five forging companies in the country and global manufacturer and supplier of hot rolled forged, machined bearing rings, and automotive components for various vehicles, including two-wheelers and four-wheelers.
After the stellar debut from the tech food-delivery firm, Zomato in the IPO market, expectations are high among investors and corporates alike. Considering that, it is safe to say that the issuers are trying to capitalise on the positive sentiments of investors.
As the IPO is scheduled to open tomorrow, July 28, 2021, let’s look at the various aspects of the offer to help investors make an informed decision.
Rolex Rings IPO date
The IPO subscription will open on July 28, 2021, only for three days. The bidding window will close on July 30, 2021. Bidding for the anchor investors happened on July 27, 2021.
The public issue
The issue size of Rs 731 crore comprises both new issues and offer for sale equities from current investors. It contains primary components worth Rs 56 cores and an offer for sale of 75 lakh equity shares from Rivendell PE LLC.
Rolex Rings IPO price band
Rolex Rings has fixed the IPO price band at Rs 880-900 per equity share. The price band is fixed in consultation with the merchant banks leading the IPO offer for the issuer. They are attempting to mobilise a fund of Rs 731 crore at the upper limit of the price band.
Around 50 percent of the issue is reserved for qualified institutional buyers (QIBs). Not less than 35 percent is set aside for retail investors, and non-institutional investors (NII) gets 10 percent shares in the IPO size.
Investors can bid for a minimum lot size of 16 shares, amounting to a minimum investment of Rs 14.080 or increase their bidding size up to 13 lots or a maximum investment amount of Rs 1,87,200. Retail investors are not allowed to invest beyond Rs 2 lakh.
Utilisation of funds
Rolex Rings has plans to utilise the proceeds from the new issues towards funding long-term capital requirements and general corporate purposes. The auto component maker expects to receive listing gains, enhancing its brand name among existing and new customers from the upcoming IPO. Upon release, it will be the 29th IPO of 2021.
Rolex Rings IPO allotment date
The basis of allotment of IPO shares will happen on August 4, 2021. The initiation of refund and unblocking of ASBA funds will begin on August 5, 2021, and listing in the exchange will occur on August 9, 2021.
Company profit and financials
Rolex Rings Ltd. is one of the significant players in the auto component segment, operating since 1988. They are the manufacturer and global supplier of hot rolled forged, machine bearing rings and automotive components for two-wheelers, four-wheelers, electric vehicles, off-highway vehicles, and commercial vehicles. They are one of the top five forging companies in the nation.
They have three manufacturing units in Rajkot with 22 forging lines and a combined installed capacity to produce 1,44,750 MTPA machinery components.
Financially the company is stable and on the path of growth. They have recorded significant improvement in their debt-equity ratio lowering it from 1.79 in March 2019 to 0.70 times in March 2021. They have earned a profit of Rs 86.95 crore in FY21 on revenues of Rs 616.33 crore.
Rolex Rings will join peers like Bharat Forge, Ramkrishna Forgings, and MM Forgings upon successful listing. The company recorded a weighted average return on the net worth at 23.34 in the last three fiscal years against the industry average P/E ratio of 77.52x.
The issuer has appointed Equirus Capital Private Limited, IDBI Capital Markets & Securities Limited, and JM Financial Limited as their book running lead managers.
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