Foxconn subsidiary Bharat FIH cancels Rs 5,000 Cr IPO Plan
In a recent development reported by Mint, Foxconn’s subsidiary, Bharat FIH, has decided to shelve its plans for a Rs 5,000 crore initial public offering (IPO). The company had obtained regulatory approval for the IPO in June of the preceding year.
The decision to cancel the IPO stems from the prevailing weak conditions in the smartphone market and internal strategic shifts within the company. However, there remains a possibility that the IPO could be reconsidered in the coming year.
A knowledgeable banker familiar with the matter explained, “The stalled IPO is influenced not only by market conditions but several other factors. The evolving business landscape in India necessitates adjustments to the marketing plan, and the filed document with Sebi is now outdated,” as quoted in the Mint report.
As outlined in the draft red herring prospectus (DRHP), the IPO plan involved a fresh issuance of shares amounting to Rs 2,502 crore, alongside an offer for sale (OFS) of up to Rs 2,502 crore by the promoter group and Foxconn’s unit Wonderful Stars. The Securities and Exchange Board of India (Sebi) granted approval for the IPO on June 10, 2022.
Presently, Foxconn’s operations in India center around iPhone manufacturing, and the company has secured contracts for producing AirPods within the country. Additionally, Bharat FIH has expressed its intention to diversify beyond mobile phones, focusing on mechanics, electric vehicles, televisions, and hearables.
During the financial year ending on March 31, 2022, Bharat FIH reported revenues of Rs 18,149 crore and a profit of Rs 202 crore, marking an increase from the previous year’s revenue of Rs 15,854 crore and profit of Rs 162 crore.
About Bharat FIH:
Bharat FIH Private Ltd, previously recognized as Rising Stars Mobile India Private Ltd and a subsidiary of the Foxconn Technology Group, stands as India’s foremost Electronics Manufacturing Company. Since its inception in 2015 at Sri City, Andhra Pradesh, it has played a vital role in India’s economic development.
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