BlueStone IPO: How The Jewellery Maker's Valuation Fares Against Competition
Ahead of its Rs 1,000-crore IPO, numbers show that Bluestone's valuations lack shine when compared to peers.
BlueStone Jewellery And Lifestyle Pvt. is likely valued lower than most of its industry peers as it heads toward an initial public offering. The draft papers for the IPO, which comprises of a fresh issue worth Rs 1,000 crore and a 2.4 crore share sale by existing holders, were filed with the Securities and Exchange Board of India on Dec. 12.
As per financial records, the Bengaluru-based jewellery retailer raised Rs 75 crore on Dec. 2, via private placement of shares. At that time, the company had issued 13 lakh shares to founder and Chief Executive Officer Gaurav Kushwaha at Rs 578 apiece.
Based on this placement, BlueStone's IPO is likely to see the issuance of up to 1.73 crore new shares. Since the company already has an outstanding share capital of 13.4 crore shares, its total share capital post the IPO is likely to be of 15.13 crore shares.
At Rs 578 a share, the company's market capitalisation will likely to be over Rs 8,749 crore.
This puts it behind listed peers Titan Co., Kalyan Jewellers India Ltd. and Senco Gold Ltd. While Titan commands a market capitalisation of over Rs 3 lakh crore, Kalyan has a capitalisation of about Rs 78,000 crore and Senco over Rs 9,000 crore. BlueStone's listing is likely to put it ahead of smaller competitors PC Jeweller Ltd. and Thangamayil Jewellery Ltd.
The Accel India, Kalaari Capital, and Sunil Munjal-backed company will be using up to Rs 750 crore from the Rs 1,000 crore fresh issue, to fund its working capital requirements and general corporate purposes. Meanwhile, shareholders, including Kalaari Capital Partners II LLC, Saama Capital II Ltd., and Hero group's Sunil Munjal, will be selling up to 2.4 crore shares via the offer for sale.
BlueStone Financials
BlueStone is a loss-making company but has been narrowing the bottom-line deficiencies since fiscal 2022. As of the first quarter of the current financial year, the company reported a net loss of Rs 59 crore and a revenue of Rs 348 crore. Operating income stood at Rs 2 crore, and its margin against the top line came up to 0.6%.
The company has not paid any dividends for the quarter ending June 2024 and in fiscals 2024, 2023, and 2022.
As of June 30, the company had a cash balance of Rs 141 crore, including bank balance.
Axis Capital Limited, IIFL Capital Services Ltd., and Kotak Mahindra Capital Company Ltd. are the book-running lead managers for the offering.
