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Bengaluru-based Stanley Lifestyles, a premium and luxury furniture brand, has filed its Draft Red Herring Prospectus (DRHP) with SEBI to raise funds for its initial public offering (IPO).
The IPO with a face value of ₹2 consists of a fresh issue of up to ₹200 crore and an offer for sale (OFS)
comprising up to 1.18 million equity shares by Sunil Suresh and Shubha Sunil, up to 5.54 million equity shares by Oman India Joint Investment Fund II, up to 1 million equity shares by Kiran Bhanu Vuppalapati, and up to 2.25 lakh equity shares by Sridevi Venkata Vuppalapati.
The furniture company claims a market share of 5.61 per cent in terms of revenue in FY22. For FY23, the consolidated revenue from operations increased 43.39 per cent to ₹419 crore against ₹292.20 crore a year ago, primarily due to an increase in retail sales.
Net profit increased 50.65 per cent from ₹23.22 crore in FY22 to ₹34.98 crore in FY23. EBITDA was ₹82.72 crore (59.01 crore) in FY23, while EBITDA margin was 19.74 per cent (20.19 per cent).
Additionally, in 2018, Oman-India Joint Investment Fund invested in the company, securing a 26 per cent ownership stake. This marked the company’s inaugural round of private equity funding. Subsequently, in 2019, the company secured an additional ₹100 crore in funding from the Oman India Joint Investment Fund II.
OFS component
According to the DRHP, the Oman India Joint Investment Fund holds 13.86 million shares or 26.86 per cent, and it plans to sell 5.54 million shares in the OFS. Oman-India Joint Investment Fund II’s portfolio also encompasses investments in Divgi TorqTransfer, Annapurna Finance, PNB MetLife, Capital Small Finance Bank, My Digi Gold, ShopKirana, and HomeLane.
The offer is being made through the book-building process, wherein not more than 50 per cent of the offer shall be available for allocation on a proportionate basis to qualified institutional buyers, not less than 15 per cent shall be available for allocation to non-institutional investors, and not less than 35 per cent shall be available for allocation to retail individual bidders.
Use of funds
As per the DRHP, the proceeds from the fresh issue to the tune of ₹90.13 crore will be used towards opening new stores, ₹39.99 crore towards opening anchor stores, ₹10.04 crore towards renovation of existing stores, and ₹8.18 crore towards capex for purchase of new machinery and equipment by the company and its material subsidiary, SOSL, and general corporate purposes.
Axis Capital Ltd, ICICI Securities Ltd, JM Financial Ltd, and SBI Capital Markets Ltd are the book-running lead managers, and KFin Technologies Ltd is the registrar of the offer. The equity shares are proposed to be listed on the BSE and NSE.
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