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MUMBAI :
Raymond Ltd on Wednesday said that its board approved listing of its engineering and auto parts business arm JK Files & Engineering Ltd (JKFEL) via initial public offering in an aim to unlock value for its shareholders.
The IPO will comprise a pure offer for sale of upto ₹800 crore, subject to requisite regulatory approvals and market conditions, the firm said in a notice to exchanges.
“In this regard, the Board of Directors of the Company, at its meeting held today i.e. December 01, 2021, approved the OFS for Rs. 800 Crore subject to such variation as permitted under applicable law in the IPO through book building process which will help deleverage Raymond Limited”, Raymond said in a notice to BSE.
“The shareholding of the company in JKFEL shall stand reduced by such number of shares as may be tendered for sale in the OFS. However, post-IPO, JKFEL shall continue to remain a material subsidiary of the company”, Raymond notice added.
The firm in its September quarter earnings said that its engineering business comprising tools and hardware and auto components have achieved the significant milestone in terms of highest sales ever in a quarter with strong growth in the exports market and well supported by sustained growth in the domestic market.
Tools and Hardware segment revenue surged 38% year on year to ₹138 crore while auto components segment revenue advanced 66% to ₹81 crore. EBITDA margin grew 13.4% and 19%, respectively, for both segments.
On 27 September, the firm approved a consolidation exercise, including the combination of its tools and hardware, and auto components businesses with its engineering business to improve synergies and explore monetisation options.
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