Bharat FIH, the maker of Xiaomi and Nokia phones in India, has received the go-ahead from the market watchdog and regulator SEBI to raise Rs 5,000 crore through IPO.
The Bharat FIH IPO includes a fresh issue of shares worth ?2,502 croresand a stake sale by promoter group Foxconn's subsidiary Wonderful Stars valued at ?2,502 crores, as per an ET report.
The company said in its DRHP ¡°While we have historically been able to finance our capital expenditure through equity contributions from the promoter selling shareholder, Wonderful Stars, this may not be the case once we are a publicly-listed company. We will have to finance our future growth from internal accruals and through external debt financing and equity fundraising."?
As per the PTI report, Bharat FIH makes devices for Xiaomi and Nokia in India.??
SEBI reportedly issued its observations to Bharat FIH on June 10, which in the regulator's parlance, is equivalent to a green signal to list the IPO on the stock markets.
However, it's not yet known when the IPO will be rolled out.
The company Bharat FIH, which reportedly said that it is India's largest electronics manufacturing service provider with a 15% revenue share, is indirectly a part of the Foxconn Technology Group, owned by its subsidiary Wonderful Stars, according to the DRHP filed by the company in December 2021.?
Bharat FIH derives most of its revenue in India from smartphone and smart TV market leader, Xiaomi, and has operations across campuses in Andhra Pradesh and Tamil Nadu where it integrates manufacturing, warehousing, logistics, and accommodation facilities, as per ET. The draft prospectus also stated that after Xiaomi, Bharat FIH's second-largest customer is HMD, which markets and sells Nokia-branded mobile phones.
Bharat FIH Ltd is a subsidiary of FIH Mobiles and a?Foxconn?Technology Group company?that boasts of clients like HTC, Nokia, Xiaomi etc.
The contract manufacturer plans to use the net proceeds from the IPO to pay out cash dividends to its shareholders, pay for its continuing operations and for future business growth and developments.?
The manufacturer is also said to be planning to expand into industries other than mobile phones, and into electric vehicles, televisions and hearables. It has also set up a Taiwan-based subsidiary, Bharat Taiwan Corporation, to explore technology transfer and collaboration with its R&D centers in India.
Separately, SEBI has also sought clarifications from Lava Mobiles for its ?1,500-crore IPO. The Noida-based smartphone brand and contract manufacturer had filed the draft prospectus in September 2021 that stated a fresh issue of equity shares worth ?500 crores, and an offer for sale component of 43,727,603 equity shares, as per ET.
Also Read:?Explained: How Are IPOs Different From NFOs?
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