GNG Electronics Files DRHP With SEBI For An Initial Public Offering (IPO) To Raise Rs 825 Cr

A non-governmental organisation located in Mumbai, GNG Electronics Limited, has submitted its Draft Red Herring Prospectus (DRHP) to the Securities and Exchange Board of India (SEBI), the market watchdog. The IPO consists of an offer for sale (OFS) of up to 9,700,000 equity shares with face values of Rs 2 each, as well as a fresh issue of equity shares with face values of Rs 2 each, totalling up to Rs 825 crores. Up to 35,000 equity shares by Sharad Khandelwal, up to 35,000 equity shares by Vidhi Sharad Khandelwal, and up to 9,630,000 equity shares by Amiable Electronics Private Limited are included in the offer-for-sale segment.

The issue's Book Running Lead Managers are JM Financial Limited, IIFL Capital Services Limited (formerly known as IIFL Securities Limited), and Motilal Oswal Investment Advisors Limited.

The company plans to use the IPO's net proceeds for a number of strategic initiatives, including financing working capital needs and paying off outstanding debts taken out by the company as well as its significant subsidiary, Electronics Bazaar FZC. Prior to filing the Red Herring Prospectus with the RoC, a further issue of specified securities totalling up to Rs 1,650.00 million may be made for the pre-IPO placement by a preferential issue or any other means.

"Pursuant to a resolution passed by our Board dated December 3, 2024 and a resolution passed by our Shareholders dated December 3, 2024, the face value of the equity shares was split from Rs 10 per equity share to Rs 2 per Equity Share. Accordingly, the authorised share capital of our Company, being 25,000,000 equity shares of Rs 10 each was split into 125,000,000 Equity Shares of Rs 2 each, and the issued, subscribed and paid-up equity share capital of our Company, being 38,776 equity shares of Rs 10 each was split into 193,880 Equity Shares of Rs 2 each," said GNG Electronics in its DRHP.

The company's operational revenue from laptop sales alone accounted for 75.59%, 67.87%, 79.97%, and 89.12% growth, respectively, of the six-month period ending September 30, 2024, Fiscal 2024, Fiscal 2023, and Fiscal 2022. As of the six-month period that concluded on September 30, 2024, it received 75.65%, 57.97%, 50.53%, and 40.20% of the revenue growth from sources outside of India for Fiscal 2024, Fiscal 2023, and Fiscal 2022, respectively. While the global market for reconditioned consumer electronics products expanded by 10% between FY22 and FY24, Electronics Bazaar's revenue from operations rose at a CAGR of 48%.

Its revenue from operations for the fiscal years ending March 31, 2024, 2023, and 2022 was Rs 6,079.62 million, Rs 11,381.38 million, Rs 6,595.42 million, and Rs 5,204.95 million, respectively, for the six-month period ending September 30, 2024. For the six months ending September 30, 2024, the company's net income was Rs 50.10 million. The company's six-month profit after tax ended on September 30, 2024, at Rs 352.12 million. It spent a total of Rs 5,736.39 million as net expenses throughout the six months that ended on September 30, 2024.

As of March 31, 2024, GNG Electronics Limited was the largest laptop and desktop refurbisher in India and one of the largest ICT device refurbishers worldwide, having a substantial presence in India, the United States, Europe, Africa, and the United Arab Emirates. Operating under the "Electronics Bazaar" name, GNG Electronics Limited is present throughout the whole refurbishing value chain, including sourcing, refurbishment, sales, after-sale services, and warranty provision. As of CY 2023, Lenovo and HP, the two leading worldwide brands with respective market shares of 24% and 21%, are certified refurbishing partners of the firm.

As of September 30, 2024, the operations, which span 35 countries in North America, South America, Asia, Asia Pacific, Europe, Africa, and the Middle East, are backed by five renovation facilities spread across India, the United States, and the United Arab Emirates. These facilities total 58,127.82 square feet and are located in three locations in Sharjah, the United Arab Emirates, one in Navi Mumbai, Maharashtra, India, and one in Dallas, Texas, USA.

The equity shares of the company are proposed to be listed on BSE and NSE.