Kross Ltd has submitted its preliminary draft papers to capital markets regulator Securities and Exchange Board of India (SEBI) for hike ₹500 crore through an initial public offering (IPO). The Jamshedpur-based company's first public issue comprises a fresh issue of shares worth up to ₹250 crore and an Offer for Sale (OFS) of shares aggregating up to ₹250 crore from the promoters, according to the Draft Red Herring Prospectus (DRHP).
The OFS share consists of equity shares amounting to up to ₹168 crore from Sudhir Rai and ₹82 crore from Anita Rai. The Company may make a placement of its securities valued at up to prior to the IPO ₹50 crore.
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With such a placement, the volume of the new issue is reduced. Equirus Capital is the book-running lead manager for this offering. The shares are proposed to be listed on BSE and NSE stock exchanges.
Kross Limited proposes to use the net proceeds of the new issue to finance the company's capital expenditure needs for the purchase of machinery and equipment – what it will use it for ₹70 crore. The company intends to use up to ₹90 crore for full or partial repayment or early repayment of all or part of certain outstanding loans of banks and financial institutions.
The company wants to use ₹30 crore to fund the working capital requirements of the company and funds will also be used for general corporate purposes. The promoters of the company are Sudhir Rai, Chairman and Managing Director; Anita Rai, full-time director; Sumeet Rai, Whole Time Director and Kunal Rai, Chief Financial Officer.
Kross Ltd – whose major customers include Ashok Leyland and Tata International DLT Private Limited, supplies its products to a diverse customer base. These include major original equipment manufacturers (OEMs) that manufacture M&HCVs and tractors, world-class suppliers to the OEMs in the M&HCV segment, as well as domestic dealers and manufacturers for the trailer axle and suspension business.
It has also acquired new customers such as Leax Falun AB, a Sweden-based company that produces propeller shafts for commercial vehicle OEMs, and a Japan-based OEM that produces commercial vehicles.
Kross Ltd is a diversified player focused on manufacturing and supplying trailer axle and suspension assemblies as well as a wide range of forged and precision-machined, safety-critical, high-performance parts for medium and heavy-duty commercial vehicles and agricultural equipment.
In fiscal year 23, the company's operating revenue was ₹489 crore with a profit after tax of ₹31 crore. Established in 1991, the company has five manufacturing facilities in Jamshedpur, Jharkhand, with capacity to design, develop and manufacture its diverse product portfolio.
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