Ethos Limited has informed the Exchange about statement of deviation(s) or variation(s) under Reg. 32
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Ethos Limited, the luxury watch retailer, has reported that there is a deviation in the use of IPO proceeds for Q1 FY26 (quarter ended June 30, 2025). The company raised up to Rs. 40,226 lakh through its IPO in May 2022, with net proceeds of Rs. 33,968.95 lakh (revised). Of this, Rs. 33,244.29 lakh has been utilized so far. The deviation pertains to Rs. 979.72 lakh earmarked for 'establishing new stores and renovating existing stores', which remained unutilized because partner malls delayed their opening — a reason the company says was beyond its control. Shareholders had already approved reallocation via postal ballot on March 21, 2024, and the company must deploy the remaining amount within 18 months of that approval. Other objects — borrowings repayment, working capital, ERP upgrade, and general corporate purposes — have been fully utilized. CRISIL Ratings is the monitoring agency, and neither the Audit Committee nor auditors raised any concerns.
The filing is largely procedural and confirms no fresh misuse of IPO funds. However, the continued delay in deploying the ~Rs. 980 lakh for new stores highlights slower-than-planned retail expansion, which could weigh on growth sentiment. Investors should track store openings over the next year to confirm whether the revised timelines are met.