U H Zaveri RI review - (Not Rated)

•    The company is in the business of marketing of gold/silver jewellery and other products.
•    It posted minuscule performances for the recent fiscals with declining bottom lines.
•    The company operates on third party contracts, does not have its own manufacturing unit.
•    The company is operating in a highly competitive and fragmented segment.
•    There is no harm in skipping this at par RI, which is a “High Risk/Low Return” bet.

PREFACE: The company announced its RI a week back, but its offer document got uploaded on designated exchange only post noon today i.e., October 29,2025. Surprisingly its offer document is dated September 22, 2025, and the record date for RI eligibility was of October 03, 2025. This shows the alertness of the management for compliance matters. Even the offer document has financial data only till December 31, 2024, and mentioning a link for financial results as of March 31, 2025, and June 30, 2025, such reporting, I am coming across for the first time. Is such a deviation for financial matter reporting is allowed and accepted by the designated exchange and the regulator???

ABOUT COMPANY:
U H Zaveri Ltd. (UHZL) is operating as a gems and jewellery business entity, divided into two primary divisions: one focusing on the wholesale and retail of jewellery, and the other engaged in jewellery trading. The majority of its sales come from gold jewellery, with a smaller portion derived from silver jewellery and other related items such as utensils. It does not produce jewellery in-house; instead, the company outsources its manufacturing. Its jewellery offerings are either designed internally, through 3D jewellery design, by external designers, or sourced directly from manufacturers as ready-to-sell pieces. 

Both, its registered office and showroom are located on Nikol Road and Vejalpur in Ahmedabad. Its showroom boasts an exclusive collection of contemporary, antique, kundan, polka, and temple jewellery. Additionally, it offers customized jewellery and a variety of gold and silver jewellery items, all available in diverse, attractive designs at competitive prices. Its products span a range of price points, catering to customers across the high-end, mid-market, and value segments.

UHZL aims to offer its customers a diverse selection of jewellery, catering to both special occasions and every-day wear. Its products range includes gold and silver jewellery, with or without studded precious and semi-precious stones, featuring a wide variety of earrings, neckpieces, armlets, bangles, anklets, bracelets, pendant sets, rings, nose studs, chains, and more. Additionally, it promotes fashion jewellery, offering casual custom pieces and accessories for everyday wear. All its jewellery is available for purchase exclusively at its retail showroom on Nikol Road, Ahmedabad. As of March 31, 2025, it had just 8 employees on its payroll.

ISSUE DETAILS:
The company is coming out with its Rights Issue (RI) of 20388000 equity shares of Re. 10 each at par value to mobilize Rs. 20.39 cr. The RI opens for subscription on October 30, 2025, and will close on November 10, 2025. The company is offering RI in the ratio of 2 for 1 to its eligible stakeholders as of the record date of October 03, 2025. The company is asking for full money on application for the number of shares applied. Post allotment, RI shares will be listed on BSE. The company is spending Rs. 0.25 cr. for this RI process, and from the net proceeds, it will utilize Rs. 19.89 cr. for working capital, and Rs. 0.25 cr. for general corporate purposes. 

The RI is self-managed by the company itself, and KFin Technologies Ltd. is the registrar to the issue. 

Post-RI, company’s current paid-up equity capital of Rs. 10.19 cr. will stand enhanced to Rs. 30.58 cr. Based on the RI pricing, the company is looking for a market cap of Rs. 30.58 cr. 

FINANCIAL PERFORMANCE:
On the financial performance front, for the last three fiscals, the company has posted total income / net profit/ - (loss), of Rs. 14.77 cr. / Rs0.83 cr. (FY23), and Rs. 20.59 cr. / Rs. 0.65 cr. (FY24). Rs. 31.68 cr. / Rs. 0.21 cr. For the Q1 of FY26 ended on June 30, 2025, it earned a net profit of Rs.0.02 cr. on a total income of Rs. 5.60 cr. Thus, while it has given its financial performance till December 31, 2024 only in the offer document, it has provided a link for financial data of periods ended on March 31, 2025, and June 30, 2025, which is highly surprising. Can such type of reporting be done and accepted by the regulatory bodies?

DIVIDEND POLICY:
The company has not paid any dividends for the reported periods. It will adopt a prudent dividend policy, based on its financial performance and future prospects. However, offer document is silent on its dividend policy.

SCRIP PERFORMANCE: BASED ON BSE WEBSITE DATA: SCRIP CODE: 541338 (FV Rs. 10).
The scrip last closed on cum-right basis at Rs. 18.44 on October 01, 2025, and opened on an ex-right basis at Rs. 13.46 on October 03, 2025. Since then, it has marked a high/low of Rs. 15.00 / Rs. 12.88. The scrip last closed at Rs. 13.57 as of October 29, 2025. For the last 52 weeks’ it has posted a high/low of Rs. 15.29 / Rs. 5.82. The counter is currently under GSM: Stage 0 / ESM: Stage 2.

The promoters’ holding has been at 26.29% for the last three quarters, till the quarter ended as of September 30, 2025. The counter is well maintained above the par value to tempt investors.