About Utssav Cz Gold Jewels Limited IPO

Utssav Cz Gold Jewels Limited is set to open its IPO on July 31, 2024, and it will close on August 2, 2024. The company is issuing 6,318,000 equity shares, aiming to raise ₹69.50 crores. The allotment for the Utssav Cz Gold Jewels IPO is expected to be finalized on Monday, August 5, 2024. The IPO is scheduled to list on the NSE SME platform on August 7, 2024.
Utssav Cz Gold Jewels IPO price band is set at ₹104 to ₹110 per share. The minimum lot size for an application is 1200 Shares. The minimum amount of investment required by retail investors is ₹132,000. The minimum lot size investment for HNI is 2 lots (2,400 shares) amounting to ₹264,000. Bigshare Services Pvt Ltd

Utssav Cz Gold Jewels IPO Reservation

Category Subscription (times) Shares Offered Shares bid for
QIB 0.00 12,00,000 0
NII* 1.98 9,00,000 17,78,400
Retail 5.37 21,00,000 1,12,78,800
Total 3.11 42,00,000 1,30,57,200

Utssav Cz Gold Jewels IPO Anchor Allocation

Anchor Bid Date 30 July, 2024
Total no. of shares offered 1,800,000
Portion Size for Anchor Investors 19.80 Cr.
Lock-in Period for 50% shares (30 days) 4 September, 2024
Lock-in Period for rest of shares (90 days) 3 November, 2024

Company Profile

Utssav Cz Gold Jewels Limited was incorporated in November 2007. They specialize in designing, manufacturing, wholesaling, and exporting a variety of CZ gold jewellery including 18Karat, 20Karat, and 22Karat gold. The product range includes rings, earrings, pendants, bracelets, and more. The company has established a significant presence in India and overseas, offering lightweight jewellery suitable for daily and fashionable wear.

The company’s manufacturing facility in Andheri East, Mumbai, covers 8,275 square feet and produces a variety of jewellery with a capacity of 1,500 kg per annum. The company’s customers are in 17 states and 2 union territories in India, as well as 2 countries abroad. In the 2023 financial year, the 18K and 22K gold jewellery categories accounted for 73.27% and 24.94% of total sales, and in the ten months ending January 31, 2024, they were 74.22% and 24.67% respectively. The company, with 15 CAD designers, develops about 400 designs monthly to stay ahead of market trends and meet customer demands.

Financial Performance

The company has demonstrated a robust financial trajectory with substantial revenue growth noted in recent years. The financial performance highlights a consistent increase in revenue, with notable profitability improvements.

Period Ended 31 Jan 2024 31 Mar 2023 31 Mar 2022 31 Mar 2021
Assets 12,333.33 8,215.83 5,616.49 4,423.40
Revenue 27,733.20 23,971.52 12,342.53 12,030.66
Profit After Tax 1,073.76 714.96 333.95 161.87
Net Worth 3,311.00 2,237.24 1,509.33 1,175.38
Reserves and Surplus 2,891.00 1,817.24 1,089.33 755.38
Total Borrowing 7,703.16 4,966.02 3,601.97 3,016.08

IPO Objectives

The proceeds from the IPO are intended for funding the company’s working capital requirements and for other general corporate purposes.

Market and Analysis

The IPO has been met with mixed reviews. Some analysts suggest caution, noting the competitive and fragmented nature of the jewellery sector, and concerns regarding transparency and valuation, suggesting potential investors might consider other options or exercise caution. Below are the points to be considered before deciding to invest in Utssav Cz Gold Jewels Limited IPO

•The company is operating in a highly competitive and fragmented segment of gold jewellery.
•The sudden boost in its bottom lines from FY23 onwards raises eyebrows and concern over its sustainability.
•Based on FY24 annualized super earnings, the issue appears fully priced discounting all near-term positives.
•While recent SME IPOs are going public with March 24 numbers, this company is going public with January 31, 2024 numbers.
•The company did a placement at Rs. 82.50 per share in April 2024.
•Now, it is asking Rs. 110 at the upper cap from the public.
•There is no harm in skipping this “High Risk/Low Return” pricey issue.

Conclusion / Investment Strategy

The company is engaged in the business of designing, manufacturing, wholesaling and exporting 18Karat 20Karat and 22Karat CZ Gold jewellery. This segment is highly competitive and fragmented. Though the company has given financial data till January 31`, 2024, its basis of offer price data is based on March 31, 2023 data. This indicates many lapses on the part of LM/Company in maintaining transparency. Why one should subscribe to such an IPO, which is missing the latest info? The company issued a private placement in April 2024 at Rs. 82.50 per share, but the IPO has a price band of Rs. 104 – Rs. 110. There is no harm in skipping such High Risk/Low Return” bet.

Review By Dilip Davda on July 27, 2024
Read the detailed review report by Dilip Devda! Here!!