Rolex Rings IPO – Issue Details, Dates, Price, GMP, Review and Analysis

Rolex Rings IPO – Review and Analysis

Rolex Rings IPO – Issue Details, Dates, Price, GMP, Review and AnalysisRolex Rings IPO – Issue Details, Dates, Price, GMP, Review and Analysis

Rolex Rings Limited IPO would open for subscription on 28th July 2021. Rolex Rings is among the top five forging companies in India. Company generated strong revenue and margin growth in the last 3 years. Should you invest in Rolex Rings IPO? What are the risk factors investors should consider before investing in such IPOs? In this article, we would provide Rolex Rings IPO issue details, dates, price band, grey market premium, review and analysis.

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What is Rolex Rings Limited business?

Rolex Rings is one of the top five forging companies in India. It is also a manufacturer and global supplier of hot rolled forged and machined bearing rings, and automotive components for segments of vehicles including two wheelers, passenger vehicles, commercial vehicles, off-highway vehicles, electric vehicles), industrial machinery, wind turbines and railways, amongst other segments.

They supply domestically and internationally to large marquee customers including some of the leading bearing manufacturing companies, tier-I suppliers to global auto companies and some auto OEMs. As of today, they have three manufacturing units in Rajkot. Its manufacturing infrastructure includes high-speed hot formers from Sakamura and Hatebur and vertical forging lines from Manyo, Enomoto, Eumoco and conventional forging lines integrated with induction heating furnaces.

What are Rolex Rings IPO dates and issue details?

Here are the final dates and issue price (Updated on 26th July, 2021).

IPO Opening Date 28-Jul-21
IPO Closing Date 30-Jul-21
Issue Type Book Built Issue IPO
Face Value Rs 10 per equity share
IPO Price band Rs 880 to Rs 900 per equity share
Lot Size 16 Shares
Min Order Quantity 16 Shares
Listing at BSE and NSE
Issue Size Total Size: Rs 731 Crores
i) OFS: Rs 675 Crores
ii) Fresh Issue: Rs 56 Crores

What are Rolex Rings Limited competitive strengths?

1) It is among the leading forging companies in India.

2) Company has strong manufacturing capabilities.

3) Company has comprehensive product portfolio.

4) It has geographically diversified revenue base.

5) Company with strong and consistent financial performance track record.

Rolex Rings DRHP SEBI Link

Rolex Rings IPO RHP SEBI Link (Awaited)

What are the objects of the Rolex Rings IPO?

It has two objects of the offer:

1) Offer for Sale (OFS) Rs 675 Crores

Under OFS selling shareholders would sell the shares and company would not get any proceeds from the issue.

2) Fresh issue of Rs 56 Crores:

i) Funding long-term working capital requirements and

ii) General corporate purposes.

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Who are the Company promoters?

Rupesh Dayashankar Madeka, Jiten Dayashankar Madeka, Manesh Dayashankar Madeka, Pinakin Dayashankar Madeka, and Bhautik Dayashankar Madeka are the promoters of the company.

How is the Financial Performance of Rolex Rings Limited?

Let us check the revenue and profit details from Rolex Rings financial statements for the past 3 years.

Period ending Total Revenues (Rs in Mns) Profits after tax
(Rs in Mns)
Profit %
Mar-18 7,915.4 728.7 9.2%
Mar-19 9,112.5 590.4 6.5%
Mar-20 6,753.3 529.4 7.8%
6 Months ending Sep-20 2,254.5 253.1 11.2%

What are the positive things in Rolex Rings IPO?

Here are the positive factors what we liked in this company.

1) Company has posted strong revenue growth in the last 3 years.

2) Company has posted strong growth in margins in the last 3 years.

3) Rolex Rings is among the top five forging companies in India.

4) Company with strong manufacturing capabilities, comprehensive portfolio and geographically diversified.

What are the risk Factors in Rolex Rings IPO?

1) Company has defaulted in payment of certain loans in the past and have undergone CDR.

2) Company is heavily dependent on performance of automotive sector in India, Europe, North America, Latin America and Asia. Any adverse changes in these markets can impact company business

3) Covid-19 pandemic has effect on company business. In future any such pandemics might continue to have impact.

4) Any short=ages, slowdowns or shutdown in its manufacturing operations can lead to underutilization of its existing manufacturing facilities and can have adverse impact on business

5) Company top 10 customers accounted for substantial majority of the revenue. Any loss of these customers can have impact on company business

6) The demand of its products in foreign countries is subject international market conditions and regulatory risks which can adversely affect our business.

7) Investors should read complete risk factors indicated in the RHP of the IPO document before investing in this IPO.

What are Rolex Rings IPO Dates including allotment and listing dates?

Offer Open 28-Jul-21
Offer close 30-Jul-21
Finalization of Allotment 04-Aug-21
Initiation of Refunds 05-Aug-21
Credit to Demat Account 06-Aug-21
IPO Shares Listing Date 09-Aug-21

Is Rolex Rings IPO Price reasonably priced?

Its price band is Rs 880 to Rs 900 (Final).

1) On the upper price band of Rs 900 and EPS of Rs 22.08 for FY20, the P/E ratio works out to be 40x.

2) For the last 3 years average EPS of Rs 24.31, the P/E ratio is 37x.

3) Means, the company is asking price of Rs 860 on the upper price band in the P/E range of 37x to 40x.

5) There are listed peers like Ramkrishna Forgings where it is trading at P/E 181x (Highest) and Mm Forgings at P/E of 30x (Lowest) and industry average P/E is 97x.

Hence Rolex Rings Share Price of Rs 900 of upper price-band is reasonably priced.

What is Rolex Rings IPO GMP today?

Rolex Rings IPO GMP today is at Rs 420 per share. GMP is nothing but the premium at which the shares are trading in offline market.

GMP as per Eagleye IPO Guru on Chittorgarh – Rs 420.

GMP as per Sonal Patel IPO Mentor on Chittorgarh – Rs 540 – 545.

Rolex Rings IPO GMP IPOWatch – Rs 500 per share.

GMP as per IPO Central – Rs 350 per share.

GMP as per Top10stockbroker – Rs 400 per share

While GMP as per IPO Central is predicted at lower number at Rs 350 per share, Rolex Rings IPO GMP Chanakya is predicting at higher number at Rs 550-575 per share.

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Rolex Rings IPO Review – Should you invest?

Now you might be wondering whether Rolex Rings IPO is good or bad for investment.

Rolex Rings is among the top five forging companies in India.

Company generated strong revenue growth in the last 3 years.

Company’s generated good margins in the last 3 years.

Rolex Rings IPO price is reasonably priced.

Considering all these positive factors, investors can subscribe to this IPO for short term to long term perspective.

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4 thoughts on “Rolex Rings IPO – Review and Analysis”

  1. Rolex Rings IPO

    1) Offer for Sale (OFS) Rs *675 Crores*

    Under OFS selling shareholders would sell the shares and *company would not get any proceeds from the issue*.

    2) Fresh issue of Rs *56 Crores*:

    i) Funding long-term working capital requirements and

    ii) General corporate purposes

    I can’t understand how SEBI/RBI giving permission to promoters to pocket 645 crores of public money as against only 56 crorers utilizes for company purpose.

    And more horrible is that such shares listed at double price of higher bid amount.

    Don’t you think that this is totally artificial growth and absolute cheating by established machineries.

    1. Sanjeev, There is nothing wrong. It is clearly written in the IPO DRHP/RHP and reviewed by SEBI. Some companies even just go for listing where existing share holders would sell their stake. In this case, company would get little money for fresh issue along with listing benefits where existing share holders would sell their shares. If investors are worried about this aspect, they can give a skip on this IPO

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