Monte Carlo files for initial public offer

In signs of revival in IPO space, apparel major Monte Carlo has filed its draft offer document with Sebi, becoming the second firm announcing plans to hit the primary market after the new government came to power.

Resort town operator Lavasa filed its draft IPO papers with the capital markets regulator earlier this month. It was the first company to approach Sebi with IPO plans after the Narendra Modi government took charge on May 26.

Lavasa is planning to raise Rs 750 crore through the initial public offer, but Monte Carlo has not yet disclosed the size of its IPO.

Monte Carlo Fashions Ltd plans to sell 25% stake that would comprise of sale of over 54 lakh shares by promoters and other shareholders.

"Our company expects that the listing of the equity shares will enhance our visibility and brand image among our existing and potential customers and provide liquidity to the existing shareholders," Monte Carlo said in its draft red herring prospectus.

Proceeds from the IPO would go to the selling shareholders. They are Jawahar Lal Oswal, Dinesh Oswal, Kamal Oswal, Kanchi Investments Ltd, Oswal Woollen Mills Ltd, Abhilash Growth Fund Pvt Ltd and Vanaik Investors Ltd.

The 'Monte Carlo' brand was launched by Oswal Woollen Mills Ltd (OWML) in 1984.

Effective April 2011, OWML's woollen and cotton apparel business under the brand 'Monte Carlo' was demerged into Monte Carlo Fashions Ltd.

In the 2013-14 fiscal, the company raked in net profit of Rs 553.80 million on total revenues of Rs 5,188.92 million.

"We have been able to increase our total revenue from fiscal 2012 to fiscal 2014 at a compound annual growth rate of 17.57% and our profit after tax has increased at a compound annual growth rate of 6.47% over the same period," the prospectus said.

In the recent weeks, there have been sharp rallies in the secondary markets and the landslide victory by the BJP-led NDA in the general elections is widely expected to further boost investor sentiment.


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