Foxconn India Subsidiary Files IPO Papers With SEBI For Rs 5,004 Crore

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Bharat FIH, in its DRHP, said that it may require additional capital or financing from time to time, including for expansion of manufacturing facilities and investment in R&D

Taiwanese contract electronics manufacturer Foxconn’s India subsidiary Bharat FIH Ltd is joining the IPO bandwagon, as it files the draft prospectus with the Securities & Exchange Board of India (Sebi) to raise Rs 5,004 crore.

The IPO will consist of a fresh issue of shares of up to 25.02 billion shares. In addition, a Foxconn unit holding shares of Bharat FIH will divest a portion of its stake to raise an equal amount.

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The fresh capital will be used to upgrade and expand facilities, invest in a subsidiary to finance capital expenditure needs, fund working capital requirements, and for other corporate purposes.

Bharat FIH, which was previously known as Rising Stars India, provides manufacturing and assembly services for Xiaomi’s mobile phones in India. It is the largest EMS provider in India with approximately 15 percent market revenue share in FY 2021.

The Foxconn company derives most of its revenue in India from Xiaomi. The company has operations across campuses in Andhra Pradesh and Tamil Nadu, each of which integrates manufacturing, warehousing, logistics and accommodation facilities.

This comes as Foxconn’s plant near Chennai embroiled in controversy and is will reportedly remain shut this week following protests sparked by a food poisoning incident.

The company is also undertaking R&D efforts and intends to continue building its R&D teams to provide product design and development and other value-added ODM services. It also recently established a Taiwan-based subsidiary, Bharat Taiwan Corporation, to explore opportunities for technology transfer and collaboration with our R&D centers in India.

Bharat FIH, in its DRHP, said that it may require additional capital or financing from time to time, including for expansion of manufacturing facilities and investment in R&D. Bharat FIH said that it is exploring opportunities to export its products to overseas markets, including the Middle East and Africa.

“Our location in India provides us with a geographical advantage and enables us to deliver products to local markets in those regions quickly and at competitive cost. We are also exploring opportunities to collaborate with mobile operators in Europe and the United States, with a view to exporting mobile phones and hearables that they can offer to their network customers,” it added in the prospectus.

“In Financial Years 2019, 2020 and 2021 and the six months ended 30 September 2021, Xiaomi accounted for revenues of Rs 300,946.54 million, 235,014.92 million, ₹149,086.77 million and ₹97,530.63 million, representing 87.81%, 89.05%, 94.24% and 96.13% of our revenue from operations for these periods,” the company revealed in the prospectus.

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