Value fashion retailer Baazar Style raises Rs 250 cr from anchor investors

Value fashion retailer Baazar Style Retail Ltd announced on Thursday that it has secured Rs 250 crore from anchor investors, just a day before its IPO opens for public subscription. Among the anchor investors are Ashoka India Equity Investment Trust Plc, Volrado Venture Partners Fund IV Gamma, HSBC Global Investment Funds, Allianz Global Investors Fund, Al Mehwar Commercial Investments LLC, HDFC Mutual Fund (MF), HSBC MF, Bandhan MF, and Bajaj Allianz Life Insurance Company, according to a BSE circular.

The company has allocated 64.29 lakh equity shares to 28 funds at a price of Rs 389 each, bringing the total transaction value to Rs 250.1 crore. The Rs 835-crore IPO is set to open on August 30 and close on September 3, with a price band of Rs 370-389 per share.

The IPO includes a fresh issue of equity shares worth Rs 148 crore and an offer for sale (OFS) of up to 1.76 crore shares valued at Rs 687 crore (at the upper price band) by promoter group entities and other shareholders. This brings the total issue size to Rs 835 crore at the upper end of the price band of Rs 389.

Under the OFS, stakeholders such as Rekha Jhunjhunwala, Intensive Softshare Pvt Ltd, and Intensive Finance Pvt Ltd will sell portions of their shares. Proceeds from the fresh issue, amounting to Rs 146 crore, will primarily be used to repay debt, with the remaining funds allocated for general corporate purposes. Earlier this month, the Kolkata-based company raised Rs 37 crore from Volrado Ventures Partners Fund II in a pre-IPO placement, which led to a reduction in the fresh issue size.

Baazar Style Retail is a major player in the value retail market in West Bengal and Odisha, with additional key markets in Assam, Bihar, Jharkhand, Andhra Pradesh, Tripura, Uttar Pradesh, and Chhattisgarh. Investors can bid for a minimum of 38 shares per lot, with subsequent bids in multiples of 38. For FY24, Baazar Style Retail reported consolidated revenue from operations of Rs 972.88 crore and a profit after tax of Rs 21.94 crore. Axis Capital, Intensive Fiscal Services, and JM Financial are serving as the book-running lead managers for the IPO.

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