Baanganga Gold IPO

Easy to miss in the prospectus

• Two sets of financials run side by side throughout this draft and they are not interchangeable. The Restated Consolidated Financial Information covers the company and MNM Jewels Private Limited; every figure in this record is taken from it. The Unaudited Pro Forma Combined Condensed Financial Information additionally folds in the diamond business of the Baanganga Diamonds partnership firm as though it had been acquired on 1 April 2023, and reports FY26 revenue of Rs 3,927.87 Cr, PAT of Rs 115.53 Cr, EPS of Rs 19.25, RoNW of 72.75% and NAV of Rs 26.46. The draft's own thirty-third risk factor calls it unaudited, illustrative and hypothetical.
• The diamond half of the name is almost entirely a pro forma event. On the restated consolidated basis diamond jewellery was 0.33% of FY26 revenue from operations; on the pro forma basis it is 7.06%. The acquisition that creates the difference happened on 1 April 2026, the first day of Fiscal 2027, so no reported year yet contains it.
• MNM Jewels was brought in under common control. The company acquired its controlling interest on 18 February 2026 through a rights issue, accounted for under Appendix C to Ind AS 103 by the pooling-of-interests method, so FY25 and FY24 have been restated as though the combination had always existed. Comparisons with the subsidiary's own earlier accounts will not line up.
• Return on net worth here is struck on CLOSING net worth, not average, as note 2 to the Basis for Offer Price states: Rs 111.78 Cr of FY26 profit over Rs 187.89 Cr of year-end net worth gives the disclosed 59.49%. The draft separately discloses a return on average equity of 84.39% for the same year, computed on the average of opening and closing total equity, and the two are not alternatives for the same thing.
• Return on capital employed of 49.46% is likewise computed on AVERAGE capital employed - the average of opening and closing total equity, total debt including lease liabilities, and net deferred tax liabilities - with earnings before interest and tax as the numerator.
• The disclosed debt ratio of 1.19 is net debt to total equity: borrowings plus lease liabilities less cash and cash equivalents, over total equity. Gross borrowings over net worth at 31 March 2026 give 1.14 instead. The FY25 and FY24 borrowings in this record are the restated balance sheet's non-current plus current borrowings on the same basis that produces the draft's own stated Rs 214.14 Cr total for FY26.
• The draft's own financial tables run NEWEST FIRST — Fiscal 2026, then 2025, then 2024. Net asset value per share, which rises monotonically, and total equity of Rs 187.89 Cr, Rs 77.03 Cr and Rs 41.48 Cr are the rows that settle the column order. The CareEdge peer tables in Industry Overview run the other way, FY24 then FY25 then FY26, and say so in their headers.
• The restated cash-flow statement classifies the movement in SHORT-TERM BORROWINGS inside operating activities: Rs 93.86 Cr in FY24, Rs 8.10 Cr in FY25 and Rs 9.82 Cr in FY26. The FY24 operating inflow of Rs 23.11 Cr therefore rests on borrowing rather than on trading, and the three-year run of positive operating cash flow should be read with that line in view.
• The product-mix table appears twice and the two copies disagree by Rs 10 lakh. The copy in Our Business prints a Fiscal 2026 total of Rs 3,626.393 Cr; the copy in the first risk factor, the profit and loss statement and the KPI table all give Rs 3,626.293 Cr, which is also what the table's own two components and percentages come to. The smaller figure is the one used here.
• The promoters paid nothing for their stock. The weighted average cost of acquisition is disclosed as NIL for all three, adjusted for the bonus issue and the sub-division. Paid-up capital went from 10,000 shares subscribed at Rs 10 on incorporation to 30,010,000 after a 3,000-for-1 bonus issue on 27 March 2025, then to 60,020,000 when the face value was sub-divided from Rs 10 to Rs 5 on 30 March 2026. Vikas Navratanmal Ganna's entire 30.00% came by gift from the other two promoters on 11 November 2025.
• Only the fresh issue reaches the company. Rs 180 Cr of the Rs 720 Cr offer is a sale by two of the three promoters - up to Rs 120 Cr by Navratanmal Jeetmal Ganna and up to Rs 60 Cr by Jinesh Navratanmal Ganna. All of the figures in the offer are caps, expressed in rupees with the share counts left as placeholders, and a pre-IPO placement of up to Rs 108 Cr may be undertaken before the red herring prospectus is filed, which would reduce the fresh issue by the amount raised.
• The allocation shown is the draft's statutory maximum and minimums under Regulation 32(1) - not more than 50% of the offer to qualified institutional buyers, not less than 15% to non-institutional bidders, of which one-third is reserved for applications between Rs 0.20 million and Rs 1.00 million, and not less than 35% to retail individual bidders.
• The peer set is four companies with an arithmetic average P/E of 21.30 and a range from 11.14 times at Shankesh Jewellers to 45.85 times at Sky Gold & Diamonds, all struck on NSE closing prices of 11 September 2026 and Fiscal 2026 diluted EPS. Three of the four are reported standalone; only Sky Gold is consolidated. Shankesh Jewellers posts a 50.94% return on net worth, the closest of the four to the issuer's own.
• The industry data, the 'fully integrated manufacturer' framing, the approximately 1.9% share of the Indian gold jewellery wholesale manufacturing market in Fiscal 2026, the 70-75% long-standing-client estimate and all peer comparison data in the business section come from a CareEdge report dated 23 September 2026, which the company commissioned and paid for in connection with this offer.
• Fiscal 2024's accounts were audited twice. B. B. Lodha & Co. issued an unmodified report on 26 August 2024; because that firm was not peer reviewed at the date of its report, V J Shah & Co. re-audited the year and issued its own unmodified report. There are no qualifications in any of the three years. The FY25 and FY24 special purpose statements carry an emphasis of matter on their basis of preparation, which the auditor states does not modify its opinion.
• Litigation is small. One tax proceeding against the company for Rs 1.29 Cr, four criminal proceedings brought BY the company aggregating Rs 7.70 Cr, one statutory or regulatory proceeding against the promoters with no amount quantified, and nothing against the directors, subsidiaries or key managerial personnel. Contingent liabilities at 31 March 2026 were Rs 2.04 Cr, which the draft puts at 1.09% of net worth.
• Related-party trade is material and rising. Sales of goods to Ishani Jewels, an entity in which a director or a relative of a director has a substantial interest, went from nil in FY24 to Rs 4.67 Cr in FY25 to Rs 66.99 Cr in FY26, and sales to Baanganga Diamonds from Rs 0.21 Cr to Rs 9.30 Cr. Baanganga Diamonds is also the landlord of the registered office, Unit I and Unit II.
• The company has not declared a dividend on its equity shares in the current fiscal or the last three, and the draft states it may not do so in the foreseeable future.
• The educational qualifications of two directors, Vikas and Jinesh Navratanmal Ganna, could not be verified: the institutions have not responded to requests for certificates, and the draft relies on documents the individuals themselves supplied. The company has also been unable to trace a 2007 partnership addendum and a 2011 supplementary deed from its predecessor firm.
• Insurance cover was 95.28% of property, plant and equipment excluding land, capital work-in-progress and inventories at 31 March 2026 - up sharply from 38.47% in FY25 and 32.97% in FY24, which is where the exposure sat while the business was growing fastest.
• The company accepts returns of a limited portion of unsold jewellery from clients, refurbishing or re-melting what cannot be resold. The draft states the volumes have been minimal to date and carries the practice as its own risk factor.