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JK Files & Engineering files Rs 800-cr IPO papers

JK Files & Engineering Ltd, a company that is in the business of auto parts, has filed preliminary documents with markets regulator Sebi to raise Rs 800 crore through an initial public offering (IPO).

The public issue is entirely an offer of sale (OFS) of equity shares to the tune of Rs 800 crore by promoter Raymond Ltd, according to the draft red herring prospectus filed on Wednesday.

At present, Raymond, the country’s leading player in suiting and shirting, holds 100 per cent stake in the company.

Since the public issue is completely an OFS, the company will not receive any funds raised from the IPO.

The company is engaged in the manufacturing of precision engineered components for tools and hardware (files and drills) and marketing of hand tools, power tool accessories and power tool machines and manufacturing of auto components and engineering products — RNG gears, flexplates and water pump bearings.

JK Files & Engineering posted a consolidated profit of Rs 25.46 crore in FY2020-21 against Rs 14 crore in the previous year. Its registered a revenue of Rs 350 crore in FY21 as against Rs 382 crore in the preceding fiscal.

SBI Capital Markets, DAM Capital Advisors (formerly known as IDFC Securities) and HDFC Bank are the book running lead managers to the issue.

On December 1, diversified Group Raymond announced that its board approved the listing of its subsidiary JK Files & Engineering.

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Star Health cuts IPO size to Rs 6400 crore after undersubscription

India’s largest private health insurer Star Health has cut the size of its initial public offering (IPO) to 64 billion rupees ($848.02 million) from 72.49 billion rupees earlier after a subdued response to the IPO last week, its prospectus showed. Star Health’s IPO failed to get fully subscribed last week, signalling weak investor demand for India’s third-biggest listing this year.

Last week, a source had told Reuters that the company will cut the offer for sale portion after the weak response despite it extending the subscription period.

Backed by billionaire stock investor Rakesh Jhunjhunwala, the company had priced its IPO between 870 rupees and 900 rupees per share and a banking source had told Reuters that the company was aiming for a nearly $7 billion valuation. The IPO now consists of fresh issue of 22.2 million shares and offer for sale of 48.89 million shares, according to the prospectus dated Dec. 7, while the issue and offer were “subject to finalisation of basis of allotment.”

Investors will be closely watching the listing which is likely on Friday after Paytm’s dismal debut in November cast doubts on the big ticket IPOs and sparked concerns about overvaluation in the domestic equity market.Indian payments firm MobiKwik deferred its IPO plans, following Paytm’s lacklustre performance.

Other large offerings planned for later this year and the next include Softbank-backed firms Delhivery and OYO, which have filed draft papers for IPOs worth $992.73 million and $1.12 billion, respectively, and that of state-owned life insurance giant LIC, expected to be India’s biggest.Incorporated in 2005, Star Health offers coverage options for retail health, group health, personal accidents and overseas travel insurance.

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Specialty chemical firm Aether Industries plans to file up to Rs 1,000-crore IPO next week

Specialty chemical company Aether Industries plans to file preliminary documents for an initial public offering of as much as Rs 1,000 crore next week, according to people familiar with the matter.

Kotak Mahindra Capital Company Ltd and HDFC Bank Ltd have been appointed as merchant bankers to advise the company on the public issue, they added.

Aether Industries started with an R&D unit in 2013, and began commercial production in 2017. It caters to the pharmaceutical, agrochemical, material science, electronic chemical, high performance photography and oil and gas industry segments.

Currently, it has a capacity of over 4,000 MT.

The Surat-based company has recently raised over Rs 100 crore from White Oak Capital and IIFL in the pre-IPO round.

The company’s operating revenue grew to Rs 450.23 crore in FY21, from Rs 301.87 crore in FY20, and its net profit climbed 75 per cent to Rs 71 crore in FY 21, from Rs 39.6 crore in FY20.

According to people familiar with the matter, the company has finalized the plan to raise Rs 800-1,000 crore through an initial public offer (IPO) and is expected to file its draft red herring prospectus (DRHP) with the markets regulator Sebi next week.

The pandemic has compounded the situation further as companies across the world are looking for alternate supply solutions as they want to reduce dependence on China and develop either local supply chain or alternative chain.

As a result, several Indian players witnessed order inflows from global chemical players to meet the supply disruptions from China.

Amongst the recently listed specialty chemicals companies, shares of Laxmi Organics, Rossari Biotech, Clean Science Technologies, Tatva Chintan and Ami Organics have given returns in the range of 40 per cent to 200 per cent from their issue prices.

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Crypto Bill 2021: 5 key questions about crypto ads, scams, taxes, more answered by Nirmala Sitharaman

As the Indian crypto market awaits the introduction of the Cryptocurrency and Official Digital Currency Bill 2021, in Parliament’s Winter Session, Finance Minister Nirmala Sitharaman during the Question Hour in Rajya Sabha on Tuesday noted that the bill is awaiting clearance from the cabinet. Here’s a quick recap of everything the finance minister said around cryptocurrencies in Parliament:

Ques – What are government plans on shutting down crypto advertisements?

Nirmala Sitharaman – There is no solution currently to close crypto ads but certainly to caution people around the risk involved, government is taking steps via SEBI and RBI. While they could do more (in raising awareness) but we are now at a point that the bill will soon come.

The question of shutting crypto ads was raised by senior BJP leader and Rajya Sabha MP Sushil Kumar Modi. The MP later added “during the recent cricket world cup, over Rs 50 crore was spent by crypto exchanges in ads that ran without any disclaimer. These ads are misleading and can lead to heavy losses.”

Modi also highlighted that the Crypto Bill was listed during the Budget Session as well but couldn’t be introduced.

Nirmala Sitharaman – Last time the bill was proposed but subsequently because there were other dimensions, which in real-time, we thought were important to bring into the bill. That bill has been reworked and is now coming as a new bill. So, the intent was either we improve that bill or come with a bill that is far more recent. Once the Cabinet clears the bill, it will come into the house. About misleading ads and banning ads, Guidelines of Advertising Standards Council of India are being studied and regulations that they have are all being looked into so that, if necessary, we can take some kind of decision to say how we are going to handle this.

Ques – What government is planning to do about the risk of money laundering and scams with the growth in crypto transactions?

Nirmala Sitharaman — The risk that this can lead to some kind of illegal transfers to not so desirable activities are matters which are being well monitored in the regular course also by institutions, by enforcement authorities etc. These are matters which are discussed at various levels.

Ques – Would there be a separate legal framework for non-fungible tokens (NFTs)? Also, how many people have paid income tax on crypto income and how much tax has been collected?

Nirmala Sitharaman — I don’t have the ready information on how much tax has been collected on crypto or how much has been paid on it. On having a separate framework for NFTs, at this moment I may not be able to say that there will be a separate framework or not, but certainly, all these matters are being discussed.

Ques – What government is doing to make people aware of risks associated with crypto investments?

Nirmala Sitharaman – Until the bill comes, there have been statements issued through the government, SEBI, and RBI (on the risks involved), and also fair awareness-building attempt has been made to say that this is a risky area and people should be conscious of what they are doing. Awareness or ‘alert’ has been issued so that people are fairly cautioned. That much has been done.

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