Kolkata-based Balaji Solutions Limited (BSL), is one of the leading IT hardware and mobile accessories companies engaged in the business of manufacturing, branding, and distribution of products under its flagship brand, "Foxin" ("Foxin Products") has filed its Draft Red Herring Prospectus (DRHP) with the markets regulator, Securities and Exchange Board of India (SEBI), to raise funds through an initial public offering (IPO).
The public issue consists of a fresh issue of equity shares worth up to Rs 120 crore and an offer-for-sale (OFS) of up to 75,00,000 equity shares by Promoter and selling shareholders, which comprises up to 15,00,000 by Rajendra Seksaria, up to 60,00,000 by Rajendra Seksaria HUF ("Selling Shareholders"). The offer also includes a reservation for a subscription by eligible employees.
The company in consultation with merchant bankers on the issue may consider a pre-IPO placement aggregating up to Rs. 24 crores. If such placement is completed, the fresh issue size will be reduced.
The proceeds from its fresh issuance worth Rs. 86.60 crores will be utilized for funding incremental working capital requirements of the Company, and general corporate purposes.
Balaji Solutions commenced operations in 2001 under the leadership of Rajendra Sekasaria who has more than 2 decades of experience in the electronics business. It started as a distribution house and today manufactures its own brand Foxin which it launched in 2006. West Bengal, Tamil Nadu, Maharashtra, Karnataka, and Kerala states collectively accounted for 59.35% of its revenues in FY22. As of June 30,2022, it caters to 5 brand owners in India.
BSLs manufacturing facility in Howrah has 4 production lines, aggregating to a total installed capacity of 216 lakh units in FY22. As of June 30, 2022, it sold its products in 28 states and 5 union territories through a network of 3,726 dealers of which 1,873 dealers with 27 branch offices in India which are supported by a sales team of 248 employees.
Its revenue from operations decreased by 0.6% to Rs 482.25 crore for the Financial Year 2022 from Rs 483.48 crore for the Financial Year 2021, primarily due to normalization post easing of Covid 19 lockdown restrictions, while profit for the financial year 2022 stood at Rs 15.39 crore.
India is one of the leading contenders for alternate solutions for global electronics companies, with the potential to be one of the most attractive manufacturing destinations and support the objective of 'Make in India for the World'. The electronics sector has the potential to become one of the top exports of India in the next 3-5 years. Electronics exports may account for significant contributions to the Indian economy in terms of foreign exchange earnings and employment generation. The Indian electronics industry is estimated to grow at a CAGR of 25% from Rs. 8,720.1 billion in FY21 to Rs. 26,500 billion in FY25. Domestic production is envisaged to grow at a CAGR of 30% from Rs. 5,544.6 billion in FY21 to Rs. 20,500 billion in FY26.
As stated by the Fitch report in its DRHP, it is interesting to note that India imports more than 90% of the total hardware and peripheral products.
IDBI Capital Markets and Securities Limited, and Affinity Global Capital Market Private Limited are the books running lead managers and KFintech Technologies Limited is the registrar to the offer. The equity shares are proposed to be listed on BSE and NSE.