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The owner of the “Flair” brand, which has been a household name for more than 45 years, Flair Writing Industries Limited (“The Company”), has submitted its Draft Red Herring Prospectus (“DRHP”) to market watchdog Securities and Exchange Board of India (“SEBI”) for an Initial public offering.
A total of 745 crore rupees worth of equity capital (face value: 5) will be raised by the company. The entire amount of the offer consists of (i) a new equity share issue with a maximum value of 365 crore and (ii) an equity share offer for sale with a maximum value of 380 crore. The corporation is the dominant player in the Indian pen and writing instrument market, according to a CRISIL assessment, with financial year 2023 sales of 754.18 crore rupees. As of March 31, 2023, it had a market share of about 9% in India’s entire market for writing and creative instruments.
The Company plans to use the net proceeds of the Fresh Issue to fund the following goals: (i) establishing a new writing instrument manufacturing facility in Gujarat’s Valsaddistrict at an estimated cost of 95.62 crore; (ii) funding the company’s and its subsidiary’s capital expenditures at an estimated cost of 86.75 crore; and (iii) funding the company’s and its subsidiaries’ working capital needs at an estimated cost of FWEPL(1) and FCIPL(2). With a revenue of 915.55 crore in the financial year 2023, the Company ranks among the top three companies in the entire writing instruments industry. When compared to the growth rate of the writing and creative instrument business as a whole, the Company is also one of the top two organized companies with greater revenue growth. Between the fiscal years 2017 and 2023, the industry expanded at a CAGR of 5.5%; over the same time period, it expanded at a CAGR of roughly 14%.
76 crore worth of equity shares are being offered for sale by Mr. Khubilal Jugraj Rathod, 57 crore worth of equity shares are being offered for sale by Mr. Vimalchand Jugraj Rathod (the “Promoter Selling Shareholder”), and 38 crore worth of equity shares are being offered for sale by Mrs. Nirmala Khubilal Rathod, 38 crore worth of equity shares are being offered for sale by Mrs. Manjula Vimalchand
