KOCHI: For the second time since 2011, Thrissur-based jeweller Joyalukkas dropped its Rs 2,300 crore initial public offering (IPO) citing unfavourable stock market conditions and substantial changes in its financial results. “We hope to tap the IPO market in the 2024-25 financial year,” Joy Alukkas, the MD of Joyalukkas India Ltd, told TNIE.
Citing the reasons for dropping the IPO plan, Alukkas said, “First, our numbers have improved substantially. Second, the market conditions are not favourable.”
Joyalukkas had filed IPO documents with Securities and Exchange Board of India (Sebi) last March.
It planned to use Rs 1,400 crore of the proceeds to repay or pre-pay debt and the rest to fund opening of new showrooms and for general corporate purposes. It was scheduled to announce the IPO date in early 2023.
In 2011, Joyalukkas filed its draft document with Sebi for Rs 650 crore IPO. However, it dropped the plan due to various factors, including choppy market conditions.
Analysts said the dip in gold consumption in 2022 after prices of the yellow metal touched near-record high may be the latest reason behind the firm’s decision to shelve its IPO plan. According to the World Gold Council (WGC), India’s gold consumption fell by 3% in 2022 from the previous year. The decline in consumption was 774 tonnes last year as demand dropped 20% to 276.1 tonnes in the December quarter, as per WGC.
‘Wrong to blame fall in sales for IPO plan drop’
Joy Alukkas said the assessment by the analysts was incorrect. “All big retail jewellers, including ours, showed 30 to 35% growth in sales in recent quarters. So, it would be wrong to say we shelved our IPO plan due to fall in sales,” he said. With a net worth of $3.1 billion, Alukkas is ranked 66th richest Indian by Forbes.
In March 2021, Kerala-based jeweller Kalyan Jewellers raised Rs 1,175 crore through IPO. Kalyan IPO was priced at Rs 87/share. Though the shares were listed at Rs 73.90 each, a discount of about 15%, they are now trading at Rs 116.70 each. This is a premium of 34.13% from the IPO price.