Royal Chain, a Mumbai-based B2B jewellery manufacturer, has filed a draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) to raise ₹1,000 crore through an initial public offering. According to the DRHP filed on Monday, the company proposes to raise ₹850 crore through the issuance of fresh equity shares, while its promoters plan to sell shares worth up to ₹150 crore through an offer for sale (OFS). The company plans to utilize ₹650 crore from the net proceeds of the fresh issue to repay debt against total outstanding borrowings of ₹820.4 crore on a standalone basis, with the remaining proceeds to be used for general corporate purposes. As per The Economic Times, the IPO comprises a fresh issue of equity shares worth up to ₹850 crore and an offer for sale (OFS) of shares worth up to ₹150 crore by its promoters and existing investors.
Royal Chain operates as a vertically integrated and technology-driven original design manufacturer (ODM) of gold chains and jewellery, with an annual installed capacity of 12,000 kg. The company has significantly expanded its product portfolio to more than 27,000 designs as of June 30, 2026, and operates a manufacturing facility in Mahape, Maharashtra. As reported by The Economic Times, the company serves multiple jewellery retailers across India and supplies products to several organised retailers including Titan Company, Kalyan Jewellers India, P N Gadgil Jewellers, Senco Gold, Kalamandir Jewellers, Thangamayil Jewellery, and DP Abhushan. The B2B jewellery manufacturing platform operates within India's jewellery market, which was valued at approximately ₹7,77,840 crore in fiscal 2026 and is projected to grow to around ₹15,47,970 crore by fiscal 2031.
The company's financial performance has remained robust in recent years, with profit nearly tripling to ₹371 crore in the fiscal year ended March 2026 from ₹192.9 crore in the previous fiscal year. According to the DRHP, revenue during the same period grew 30.8 percent to ₹4,732.45 crore from ₹3,617.18 crore. However, capacity utilization has declined to 33.37% in FY26 from 37.71% in FY25 and 64.15% in FY24, indicating room for operational efficiency improvements. The strong financial metrics support the company's decision to proceed with the IPO for debt repayment and general corporate purposes.
The company faces several key risks that investors should consider. Royal Chain reported negative cash flows from operating activities and investing activities in FY26, FY25 and FY24, and warned that continued negative cash flows could adversely affect its liquidity and financial condition. Gold price volatility remains a significant risk, with the cost of materials consumed, primarily gold, standing at ₹3,655.07 crore in FY26, accounting for 81.11% of total expenses. Working capital requirements pose another challenge, as working capital loans accounted for 72.72% of total borrowings as of March 31, 2026, up from 67.33% a year earlier. The company also faces supplier and customer concentration risks, with its top 10 suppliers accounting for 66.30% of aggregate cost of goods sold in FY26, while its top 10 customers contributed 22.32% of revenue from operations.
