Flair Writing Industries files DRHP to raise Rs. 450 crore

Flair Writing Industries is all set to launch an IPO as it filed a DRHP with SEBI. It aims to raise Rs. 450 crore, of which the fresh issue amounts to Rs. 330 crore, while the remaining Rs. 120 crore pertains to an offer for sale.

The equity shares will have a face value of Rs. 10 each and will be listed on the BSE and NSE.

The company wishes to direct the proceeds of the fresh issue for acquisition of machinery worth Rs. 132.88 crore; constructing new factory buildings and associated facilities worth Rs. 69.51 crore at its manufacturing plant in Valsad, Gujarat; meeting its working capital requirements of Rs. 40.49 crore and towards repayment/prepayment of debt of Rs. 15 crore. The balance amount will be allocated towards general corporate purposes.

The prospectus highlights the details of the offer for sale by promoters as follows: Khubilal Jugraj Rathod offers Rs. 24 crore, Vimalchand Jugraj Rathod Rs.18 crore. Furthermore, Nirmala Khubilal Rathod, Manjula Vimalchand Rathod, Rajesh Khubilal Rathod, Mohit Khubilal Rathod, Sumitkmar Vimalchand Rathod offer Rs. 12 crore each. Meanwhile, Sangita Rajesh Rathod, Shalini Mohit Rathod and Sonal Sumitkumar Rathod offer Rs. 6 crore each.

Flair Writing Industries (Flair) is a popular writing instruments manufacturer in the country, with a special focus on pens. Its products are sold under the renowned brands Flair, Hauser and Pierre Cardin, Rudi Kellner and Landmark. The company’s flagship brand Flair was introduced in 1976.

While it became an exclusive distributor of Reynolds pens in India since January 2017, it also began manufacturing the same since March 2017. Flair possesses exclusive rights to the Pierre Cardin trademark in India for class 16 products. It also serves as a distributor of ZIG pens in India.

Before registering the DRHP with the RoC, it plans to indulge in a pre-IPO placement. For that, it is contemplating about issuing and allotting up to 7 lakh equity shares amounting to Rs. 50 crore as part of a private placement. Should this be executed, then the amount raised will be reduced from the fresh issue.

The book running lead managers to the issue include Axis Capital and Edelweiss Financial Services.