Kaynes Technologies files DRHP for IPO with SEBI
Kaynes Technology India Limited, an electronics and IOT company, has filed its draft red herring prospectus (DRHP) with SEBI for its proposed public offer.
Kaynes Technology India Ltd is specialized in the area of high end electronics, enablement of electronic systems and in the internet of things (IOT) space. The company is currently closely held with the two promoters accounting for a bulk of the holdings in the company.
The initial public offer (IPO) of Kaynes Technology India Ltd will comprise of a fresh issue of Rs.650 crore and an offer-for-sale (OFS) of up to 72 lakh shares by its existing shareholders and promoters. The actual size of the overall issue will only be known once the price band for the issue is finalized.
The fresh issue will be EPS dilutive and equity dilutive while the OFS portion will expand the public holding and empower the listing of stock.
The OFS will entirely be done by the promoter group comprising of Ramesh Kunhikannan and Freny Firoze Irani. The OFS consists of up to 37 lakh shares offered by Ramesh Kunhikannan and up to 35 lakh shares offered by Freny Firoze Irani.
Currently, Kunhikannan holds 87.14% stake in the company while Freny Firoze Irani holds 11.36%. The balance of 1.50% stake is held by other shareholders.
We now turn to the application of the fresh issue of funds of Rs.650 crore in the IPO. Out of the proceeds from the issue, a sum of Rs.130 crore will be utilized to repay debt. This will substantially reduce its outstanding debt in the books worth Rs.212.97 crore.
Kaynes Technology will use another Rs.98.93 crore for funding capital expenditure (capex) at its manufacturing facilities located at Mysore in Karnataka and in Manesar in Haryana.
It may be recollected that Kaynes Technology India Ltd currently operates a total of 8 manufacturing facilities in Karnataka, Haryana, Himachal Pradesh, Tamil Nadu and Uttarakhand combined.
The company will use another Rs.149.30 crore to invest in its arm Kaynes Electronics Manufacturing to set up a new facility in Karnataka. In addition, Kaynes Technology India Ltd will also use Rs.114.74 crore from IPO proceeds for working capital.
Kaynes Technology India Ltd is end end-to-end IOT solutions provider and an integrated electronics manufacturing player. It specializes in electronics system design and manufacturing (ESDM) services.
It provides conceptual design, process engineering, integrated manufacturing and life-cycle support for clients. Kaynes clients are spread across automotive, industrial, aerospace and the defence sectors.
Currently Kaynes Technology India Ltd has a combined capacity to assemble 600 million components and directly provides services to over 313 customers spread across 20 countries globally.
For the previous fiscal year FY21, the top line revenues stood at Rs.420.63 crore as against Rs.368.24 crore a year ago. That is YoY growth in revenues of nearly 14.23%. Net profit for the period was marginally higher at Rs.9.73 crore.
DAM Capital Advisors (formerly IDFC Securities) and IIFL Securities will be the lead manages to the IPO. Link Intime India Private Limited will be the registrars to the IPO. The company will be listed on the NSE and the BSE.
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