Rolex Rings shares made a healthy listing on the bourses on Monday. The share of Rolex Rings got listed at ₹1,250 on the National Stock Exchange (NSE), registering 38 per cent gains over the issue price of Rs 900 per share. On Bombay Stock Exchange (BSE), the stock started off the day at ₹1,252 per share. Rolex Rings initial public offer (IPO) opened for subscription from July 28-30. The Rs ₹731-crore issue received a bumper response from the investors. The issue was oversubscribed by 130.44 times, fifth highest subscription seen by any IPO. Rolex Rings IPO received bids for 74,16,00,096 shares compared with 56,85,556 shares on offer. The portion for qualified institutional buyers (QIBs) was subscribed 143.58 times. The non-institutional investor category received 360.11 times subscription. The quota reserved for retail individual investors (RIIs) was subscribed 24.49 times.
The automaker aimed to raise Rs 731 crore with the help of a fresh issue of equity shares worth Rs 56 crore and an offer for sale of up to 75 lakh equity stocks by Rivendell PE LLC (formerly known as NSR-PE Mauritius LLC). Rolex Rings proposed to utilise the Net Proceeds from the Fresh Issue towards funding the following objects: 1) Funding long-term working capital requirements (Rs 450 million) and 2) General corporate purposes
Rolex Rings is one of the top five forging companies in India in terms of installed capacity and a manufacturer and global supplier of hot rolled forged and machined bearing rings, and automotive components for segments of vehicles including two-wheelers, passenger vehicles, commercial vehicles, off-highway vehicles, electric vehicles), industrial machinery, wind turbines and railways, amongst other segments. It supply domestically and internationally to large marquee customers including some of the leading bearing manufacturing companies, tier-I suppliers to global auto companies and some auto OEMs. SKF India Limited, Schaeffler India Limited Timken India Limited, NEI and NRB collectively account for 81% of the market share of Indian bearing industry. It is one of the key manufacturers of bearing rings in India and caters to most of the leading bearing companies in India.
“The IPO is valued at 28.2x of FY21 earnings, which appears to be attractive considering peers’ valuations and strong return ratios. Its peers like Bharat Forge and RK Forgings command premium valuations despite generating subpar return ratio compared to RRL. We believe strong outlook for auto ancillary companies especially the forging companies with visible pick-up in demand around the globe should aid RRL to record healthy growth in the ensuing years. Further, possibility of further improvement in balance sheet, industry-leading return ratio and healthy clientele base augur well for the company,” Reliance Securities said in a note.
“Rolex Rings Ltd was incorporated in 2003, one of the top five forging companies in India. It has installed 4.7 Mn MTPA forging capacity of India’s forging industry and one of the key supplier of bearing rings in India. Rolex rings is one of the Tier-I supplier, supplies to global auto companies and some auto OEMs across automobile & automotive industry. It has in-house engineering, design tooling and die-making and raw materials are sourced from customer approved vendors. In most of the customer contracts, raw material cost pass through to the customers. The company supplies domestic as well as international automotive companies and having 60 customers across 17 countries including Germany, France, Italy, Thailand, Czech Republic, USA and others. At a upper price band of INR 900 stock is trading at a P/E multiple of 24.8(x). We believe Rolex Rings Ltd is a good long term proven business model with Comprehensive product portfolio, Integrated manufacturing facilities, strong and long term relationship with key customers, experienced management team and recovery in auto & automotive industry will lead the growth for the company,” said Arihant Capital.
Read all the Latest News, Breaking News and Coronavirus News here.
Comments
0 comment