Augmont Enterprises officials including Sachin G Kothari, Non-Executive Director, Ketan Kothari, Whole-time Director and Mahendra Kumar Nemichand Bafna, Whole-time Director at the company’s IPO event in Mumbai
Augmont Enterprises plans to hold talks with eight mutual funds to provide liquidity and handle physical redemptions under their gold and silver exchange traded funds.
The IPO-bound company will deposit bullion in the authorised vaults of MFs as per its instructions to generate ETF units for trading on the stock exchange platform. In a bid to provide liquidity in ETFs, MFs have also appointed market makers who buy gold and silver from Augmont for depositing in vaults to create ETF units.
Augmont Enterprises has presence across the entire value chain including providing a spot trading platform, refining, digital gold, jewellery manufacturing and EMI Jewellery.
The online spot trading platform has 5,200 registered jewellers who pay margin before taking position and can receive bullion delivery in two days from 20 delivery centres across the country. The company includes its charges in the gold price to avoid confusion. The company has 4.9 crore registered customers to trade on its platform.
In tie-up with NBFCs, Augmont provides gold jewellery 1 gram to 9 grams on EMI, with consumers paying 20 per cent upfront and the remaining in 3 to 9 instalments. The product is targeted at consumers from bottom of the pyramid. It also buys back old jewellery through NBFCs for refining at its refinery.
The company plans to raise ₹825 crore through fresh share issuance of ₹620 crore and promoter Kothari family selling shares worth ₹205 crore through an offer-for-sale (OFS).
The price band for the issue has been fixed at ₹750-788 per share, valuing the company at ₹7,200 crore. The IPO will open for public subscription on August 21. Shares are expected to begin trading on the stock exchanges from August 31.
The minimum bid is for 19 equity shares, and investors can bid in multiples of 19 shares thereafter. Accordingly, the minimum investment for retail investors in the offer would be ₹14,972, while the maximum investment would be ₹1,94,636.
The company intends to use proceeds from fresh shares issued for future working capital requirements, including the procurement, maintenance and scaling up of inventory and funding advance margin requirements for inventory procurement.
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