Chandigarh-based Ethos Limited, India's largest luxury and premium watch retail player delivering a content-led luxury retail experience to its customers through online and physical presence has filed its draft red herring prospectus (DRHP) for its initial public offering (IPO) with Sebi.
The initial public offering (IPO) with a face value of Rs 10 per equity share consists of a fresh issue of equity shares aggregating to Rs 400 crore and an offer for sale (OFS) of up to 1,108,037 equity shares.
The offer of sale comprises up to 2,75,000 Equity Shares by Yashovardhan Saboo, up to 5,00,000 Equity Shares by KDDL Limited, up to 50,000 Equity Shares by Mahen Distribution Limited, up to 1,50,000 Equity Shares by Saboo Ventures LLP, up to 60,000 Equity Shares by Anuradha Saboo, up to 15,000 Equity Shares by Jai Vardhan Saboo, up to 10,500 Equity Shares by VBL Innovations Private Limited, up to 6,250 Equity Shares by Anil Khanna, up to 19,231 Equity Shares by Nagarajan Subramanian, up to 10,556 Equity Shares by C. Raja Sekhar, up to 3,000 Equity Shares by Karan Singh Bhandari, up to 2,125 Equity Shares by Harsh Vardhan Bhuwalka, up to 2,125 Equity Shares by Anand Vardhan Bhuwalka, up to 2,125 Equity Shares by Shalini Bhuwalka and up to 2,125 Equity Shares by Manju Bhuwalka.
Additionally, the company, in consultation with the lead bankers to the issue may consider a further issue of equity shares including a private placement aggregating up to Rs 50 crore. If such placement is completed, the fresh issue size will be reduced.
The proceeds from its fresh issuance worth Rs. 29.89 crores will be utilised for the repayment or prepayment of borrowings, in full or part of all or certain borrowings for the company, Rs 236.75 crore for funding working capital requirements, Rs 33.27 crore for financing established of new stores, Rs 1.98 core for financing upgradation of ERP and general corporate purposes.
The company's revenue from operations stood at Rs 386.57 crore for the fiscal 2021, while its net profit was Rs 5.78 crore for the same period. For the six months ending September 2021, revenue from operations was Rs 223.31 crore and net profit was Rs 3.75 crore.
Ethos has the largest portfolio of premium and luxury watches in India and retail to 50 premium and luxury watch brands like Omega, IWC Schaffhausen, Jaeger LeCoultre, Panerai, Bvlgari, H. Moser & Cie, Rado, Longines, Baume & Mercier, Oris SA, Corum, Carl F. Bucherer, Tissot, Raymond Weil, Louis Moinet and Balmain. It enjoys a healthy market share of 20% in the luxury watch retail segment and 13% in the premium and luxury watch retail segment in India.
Under the brand name "ETHOS, it opened Its first luxury retail watch store in January 2003 at Chandigarh by its Promoter, KDDL Limited, with an experience in the watch industry it established strong relationships with the global watch brands and further strengthening its business.
In addition to the premium and luxury watch retail, it also undertakes retail of certified pre-owned luxury watches since Fiscal 2019. It has 50 physical retail stores in 17 cities in India in a multi store format, and offers an Omnichannel experience to its customers through its website and social media platforms. Through its Omnichannel approach it is premised on its endeavour to provide experience, content, customisation, reach and convenience to the customers through its website, which is the country's largest website for premium and luxury watches in terms in number of brands and watches offered.
Its physical presence is supported by its strong digital platform through its website, effective social media communication, a large database of HNI customers and an active program of home and office delivery of luxury products. As of December 31, 2021, it had about 2.5 million website users, over 2,76,000 active email subscriptions, 1,67,000 Instagram followers, 1,57,000 Facebook followers, and 11,600 You Tube subscriptions.
The luxury watch retailer has its state of the art service centre which is equipped with latest machinery imported from Switzerland, with a team of horological engineers having a minimum of 10 years of experience and certifications from leading global watch brands like Omega, Tissot, Longines, Rado among other global brands.
The Watch Market in India was valued at Rs 13,500 Cr in FY 2020 and is expected to grow at a CAGR of 10.6% to reach Rs 22,300 Cr by FY 2025, on back of factors like increased discretionary spend on watches category, opening of more organized channels of purchase like MBOs and online marketplaces & vertical specialists, increased penetration of smartwatches in mid to premium category, omnichannel market organization etc.
Emkay Global Financial Services Limited and InCred Capital Wealth Portfolio Managers Private Limited are the Book Running Lead Managers and KFin Technologies Private Limited is the registrar to the Issue.