R K Fashion Accessories Plans In-House Plating and B2C Shift

R K Fashion Accessories plans to use Rs 22.25 crore of fresh-issue proceeds for a plating facility, Kolkata showrooms and opening inventory, marking a proposed move toward in-house processing and business-to-consumer, or B2C, retail. The company projects inventory to rise from Rs 7.82 crore in FY2026 to Rs 17.68 crore in FY2027 as the new locations require display stock.

How is R K Fashion Accessories changing its operating model?

R K Fashion Accessories proposes to reduce reliance on outsourced jewellery processing while expanding both business-to-business, or B2B, wholesale and B2C retail operations in Kolkata. The company currently uses contract manufacturers for imitation and fashion jewellery processes including casting, stone setting, polishing, plating, finishing and quality inspection. It says a portion of plating is outsourced to Mumbai, creating transit time before work-in-progress, or WIP, becomes finished goods.

The proposed model combines a plating facility at Baruipur, a B2B showroom at Ezra Street and expansion of the B2C showroom at Rash Behari Avenue. The ground floor of the Rash Behari Avenue showroom began operating in April 2026 using internal resources. The company describes the G+4 building as a retail showroom project with a terrace studio planned on the fourth floor.

The proposed B2C shift has different effects on receivables and inventory. R K Fashion Accessories expects B2C sales to involve more immediate cash realisation than B2B credit sales, and projects trade-receivable days to decline from 30 days in FY2026 to 26 days in FY2027 and 25 days in FY2028. However, its showrooms are expected to require ready stock across designs, categories and price points, increasing the amount of cash tied up in inventory.

What will R K Fashion Accessories' Rs 22.25 crore plan fund?

R K Fashion Accessories proposes Rs 22.25 crore from issue proceeds for the facility, showroom projects and initial inventory, against total estimated capital expenditure of Rs 27.55 crore. The plating facility accounts for Rs 8.80 crore, while the Ezra Street showroom, Rash Behari Avenue completion and opening inventory together account for Rs 13.45 crore of fresh-issue funding.

The Rs 8.80 crore plating-facility budget includes Rs 5.83 crore for civil and structural work and Rs 2.97 crore for four physical vapour deposition, or PVD, vacuum-coating units. PVD is a vacuum-based coating process intended to deposit thin films on base materials. The machinery quotation dated April 25, 2026 covers four units, but the company had not placed orders or entered definitive agreements with vendors when it filed the draft prospectus.

The Ezra Street project has a total estimated cost of Rs 5.42 crore, of which Rs 5 lakh had been deployed as of May 12, 2026. R K Fashion Accessories has entered into a memorandum of understanding for rooms on the sixth floor of Giriya Trade Centre at 48 Ezra Street. The project still requires trade, professional-tax, fire and shop-and-establishment approvals before operations commence.

Why does the B2C shift raise R K Fashion Accessories' inventory needs?

R K Fashion Accessories projects inventory to increase 125.93% from Rs 7.82 crore in FY2026 to Rs 17.68 crore in FY2027 because the new showroom network needs stock for display and sale. Inventory is projected to reach Rs 20.41 crore in FY2028. Inventory holding days are forecast to increase from 117 days in FY2026 to 144 days in FY2027, then ease marginally to 143 days in FY2028.

Finished goods are expected to be the largest inventory component. Finished-goods holding days are projected to rise from 62 days in FY2026 to 102 days in FY2027 and 103 days in FY2028. Finished goods are forecast to represent 72.82% of inventory, or Rs 12.88 crore, in FY2027, compared with 71.44%, or Rs 14.58 crore, in FY2028; the lower share reflects expected additions to raw-material and WIP inventory after in-house plating begins.

The proposed Rs 5.60 crore opening-inventory allocation comprises Rs 4 crore for the Ezra Street B2B showroom and Rs 1.60 crore for two additional B2C floors at Rash Behari Avenue. The company says Rs 4 crore broadly matches the average finished-goods inventory of its existing B2B showroom. It estimates Rs 80 lakh of inventory per additional B2C floor, where collections are intended to be differentiated by category and design.

When could R K Fashion Accessories start in-house plating?

R K Fashion Accessories expects the Baruipur plating facility to complete and commence production by September 2027, subject to realisation of issue proceeds. The company also describes the facility as expected to commence in the second half of FY2028. It expects in-house plating to reduce Mumbai outsourcing and related transit delays, allowing faster conversion of WIP into finished goods.

The implementation schedule starts with building-plan submission and approvals in September 2026, followed by construction work through June 2027. Testing, inspections and final connections are scheduled for July and August 2027, followed by handover in September 2027. R K Fashion Accessories says it is in the process of obtaining approvals including a trade licence, factory registration, consent to establish, consent to operate and a fire licence.

The planned facility depends on both approvals and execution at the estimated cost. The company says quotations remain valid as of the draft prospectus date, but vendors and costs may change because no definitive agreements had been signed. It has stated that additional equipment costs would be funded from internal accruals, while the project estimates have not been appraised by a bank or financial institution.

How much working capital does R K Fashion Accessories project?

R K Fashion Accessories projects net working capital to increase from Rs 7.48 crore in FY2026 to Rs 12.34 crore in FY2027 and Rs 18.79 crore in FY2028. Net working capital is current assets less current liabilities. The FY2027 requirement includes Rs 1.81 crore proposed from issue proceeds and Rs 10.52 crore from internal sources, while the FY2028 amount is projected to come from internal sources.

The working-capital cycle is projected to increase from 64 days in FY2026 to 107 days in FY2027 and remain at 107 days in FY2028. The cycle had been negative 41 days in FY2024 and 31 days in FY2025, before rising as inventory and receivables increased. The forecast change reflects a larger planned inventory base even as receivable days are expected to fall with the changing sales mix.

Trade payables partly offset, but do not eliminate, the inventory funding requirement. Payables are projected to rise from Rs 3.88 crore in FY2026 to Rs 8.47 crore in FY2027 before declining to Rs 6.39 crore in FY2028. Payable days are forecast to decline from 83 days in FY2026 to 63 days in FY2027 and 61 days in FY2028, as the company expects quicker supplier payments and reduced outsourced plating.

Conclusion

R K Fashion Accessories' proposed expansion links production control with a larger Kolkata retail and wholesale footprint. The Rs 22.25 crore allocation is not only for construction and equipment: Rs 5.60 crore is designated for initial showroom inventory, and the planned inventory build is the principal reason net working capital is projected to reach Rs 18.79 crore in FY2028.

The next disclosed milestones are the targeted February 2027 completion of the Ezra Street and Rash Behari Avenue works and the planned September 2027 start of the Baruipur facility. R K Fashion Accessories has said timing, costs and the use of proceeds may be revised for market conditions, input costs, approvals or financing needs; any shortfall is proposed to be met through internal accruals and/or secured or unsecured loans.