Saturday, December 25, 2010

C Mahendra Exports IPO - Analysis, Recommendation, Review

C Mahendra Exports, a Diamond jewellery player, is entering capital market with an initial public offer (IPO) of 1.5 crore equity shares of Rs 10 each. The issue will constitute 25% of the fully diluted post issue paid-up equity share capital of the company.

The company is an integrated diamond and diamond jewellery player encompassing sourcing of rough diamonds, trading of rough and polished diamonds, processing of diamonds and manufacture of diamond jewellery.

The IPO will open on the last day of 2010 - 31st December 2010 and will close on 6th January, 2011. The company has fixed a price band of Rs 95 to Rs 110.

The proceeds of the issue will be used for setting up of a diamond processing unit at Gujarat Hira Bourse, SEZ, Ichchhapore, Surat; setting up a jewellery manufacturing unit at Mumbai; setting up retail outlets; brand development expenses and investment in capital of C Mahendra BVBA.

Anand Rathi Advisors Limited and YES Bank Limited are book running lead managers to the issue.

Recommendation:
We would not recommend this IPO to investors at this time.

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