CNBC TV18
By Priyanka Deshpande
Published Feb 7, 2024
The initial public offering (IPO) of information and communications technology (ICT) products distributor Rashi Peripherals kicked off for subscription on Wednesday, February 7. Here’s all you need to know about the company.
The ₹600 crore IPO is entirely a fresh issue of equity shares, without any offer-for-sale. Priced between ₹295-311, the market lot is 48 shares. The bidding ends on February 9.
Of the IPO proceeds, ₹326 crore will be used for payment of debt and ₹220 crore for working capital requirements and general corporate purposes.
The company serves as a distributor for 52 global technology brands in India, including ASUS, Dell, HP, and Lenovo.
It offers end-to-end services such as pre-sale activities, solutions design, technical support, marketing services, credit solutions and warranty management services.
Revenue contribution from the top 5 brands is 67.1% and top 8 brands is 82.4%.
The distribution network includes 50 branches serving as sales and service centers, along with 63 warehouses as of 1HFY24. This allows the company to reach 680 locations in India.
Revenue from operations grew at a CAGR of 26.32% from ₹59,250 million in fiscal 2021 to ₹94,543 million in fiscal 2023 and ₹54,685 million in the six months ended September 30, 2023.
The company is dependent on various vendors, who are global technology brands, for the products they distribute.
The company’s gross margins (H1FY24 5.5%) are low, which magnifies the impact of variation in revenue, operating costs, bad debts and interest expense on their operating results.
The company could be subject to product liability claims, which may have a material adverse impact on us.
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