Priority Jewels Eyes Public Market Debut, files DRHP with SEBI

Mumbai-based Priority Jewels Ltd. has filed its Draft Red Herring Prospectus (DRHP) with market regulator SEBI, signaling its intent to raise capital through an Initial Public Offering (IPO). The company, which specialises in jewellery manufacturing, aims to tap the public markets to support its financial objectives and business expansion.

Company Overview and Background

Priority Jewels was incorporated in 2007 and has over 15 years of experience in the jewellery manufacturing sector. It handles processes from design conceptualisation to manufacturing, offering a diverse portfolio primarily focused on light-weight, affordable, daily wear jewellery. The company also manufactures lab-grown diamond jewellery based on specific customer orders.

IPO Structure and Proceeds Utilisation

The proposed public offer is structured entirely as a fresh issue of up to 54 lakh equity shares with a face value of ₹10 each, and notably, includes no Offer For Sale (OFS) component. Priority Jewels plans to utilise the proceeds from the fresh issue, earmarking ₹75 crores for the repayment or pre-payment of certain borrowings. The remaining funds are intended for general corporate purposes. The company may also contemplate a pre-IPO placement in consultation with the book-running lead managers. If this pre-IPO placement is completed, the amount raised would be deducted from the fresh issue, not exceeding 20% of the total issue size.

B2B Sales Approach and Production Facilities

Priority Jewels operates two manufacturing facilities in India which serve both its domestic and export markets. The company employs a business-to-business model, selling directly to independent jewellers and jewellery chains in India and select international markets. As of December 31, 2024, Priority Jewels reported over 200 customers, predominantly located in India, comprising 159 independent jewellers and 35 jewellery chains. It has also exported to 13 countries, including the USA, UAE, Hong Kong, and Norway. Its clientele includes prominent names such as CaratLane Trading Pvt., Kalyan Jewellers India Ltd, Reliance Retail Ltd, Malabar Gold & Diamonds FZCO, Tribhovandas Bhimji Zaveri Ltd, and Senco Gold Ltd.

Rising Profitability and PAT Growth

The company has demonstrated growth in its recent financial performance. Its profit after tax (PAT) saw an increase from ₹5.37 crore in FY2022 to ₹7.15 crore in FY2024, achieving a Compound Annual Growth Rate (CAGR) of 15.35%. Correspondingly, the quantity of jewellery processed and sold also rose, from 1,30,031 pieces in FY2022 to 1,72,108 pieces in FY2024, with a CAGR of 15.05%.

DRHP Filing and Regulatory Progress

For the IPO, Mefcom Capital Markets Limited has been appointed as the book-running lead manager. MUFG Intime India Private Limited will serve as the registrar for the issue. The equity shares of Priority Jewels are proposed to be listed on both the National Stock Exchange of India Ltd (NSE) and BSE Ltd. The DRHP filing indicates the company is moving forward with its plans to access public funds, subject to SEBI approval.

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