Rashi Peripherals IPO Day 2: GMP rises, check review, key dates, more. Should you subscribe?

Rashi Peripherals IPO has opened for subscription on Wednesday, February 07, and will close on Friday, February 09. The Rashi Peripherals IPO eventually was driven by retail and non-institutional investors, despite a slow and steady start on the first day. Rashi Peripherals IPO was fully booked, by the end of the first day. According to BSE data, 1.09 times were subscribed to the Rashi IPO.

Rashi IPO price band has been fixed in the range of ₹295 to ₹311 per equity share of face value of ₹5. Rashi Peripherals IPO garnered ₹180 crores from anchor investors on Tuesday, February 06. Rashi Peripherals IPO lot size is 48 equity shares and in multiples of 48 equity shares thereafter.

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Rashi Peripherals IPO has reserved not more than 50% of the shares in the public issue for Qualified Institutional Buyers (QIB), not less than 15% for Non Institutional Investors (NII), and not less than 35% of the offer is reserved for Retail Investors.

Also Read: Rashi Peripherals IPO: Issue fully booked on day 1, retail portion subscribed 1.36 times; check GMP

Rashi Peripherals IPO details

Rashi Peripherals IPO, which is worth ₹600 crore, is completely a fresh issue of 1.93 crore equity share; there is no offer for sale (OFS) component, according to Red Herring Prospectus (RHP).

The company intends to use the net proceeds of the offer to finance the following goals: prepayment or scheduled repayment of all or a portion of the company's existing borrowings; financing the company's working capital needs as well as general corporate purposes.

The registrar for the Rashi Peripherals IPO is Link Intime India Private Ltd, while the book running lead managers are JM Financial Limited and ICICI Securities Limited.

Also Read: Rashi Peripherals IPO opens tomorrow: GMP, issue details, 10 key things to know before subscribing to ₹600-crore issue

Rashi Peripherals IPO GMP today

Rashi IPO GMP or grey market premium is +85. This indicates Rashi Peripherals share price were trading at a premium of ₹85 in the grey market, according to investorgain.com.

Considering the upper end of the IPO price band and the current premium in the grey market, the estimated listing price of Rashi Peripherals share price was indicated at ₹396 apiece, which is 27.33% higher than the IPO price of ₹311.

'Grey market premium' indicates investors' readiness to pay more than the issue price.

Also Read: Rashi Peripherals IPO opens today. GMP, review, subscription status, other details. Apply or not?

Rashi Peripherals IPO Review

Swastika Investmart Ltd

The brokerage claims that even though Rashi Peripherals is a well-known and rapidly expanding Indian reseller of international ICT brands. Some major concerns, nevertheless, need to be carefully considered. Because Rashi Peripherals depends on other vendors and channel partners, it is subject to outside influences that are not under its direct control. Scrutiny is also warranted given its very low gross margins when compared to industry peers.

“The IPO valuation of 10.54x P/E appears fully priced on a current basis. While the company's future growth potential and the positive industry outlook are encouraging thus we recommend Subscribe rating for this IPO,” the brokerage said.

Indsec Research

The brokerage claims that the IPO is priced at 13.5x FY24E annualised EPS on a post-issue basis, which is comparable to Redington, the rival, in terms of value. With 52 brands distributed under its umbrella, Rashi Peripherals is a top distributor for international technology companies. With 10,000 SKUs, the company has a substantial market share in a range of ICT goods. During FY21–23, its Revenue/EBITDA increased at a CAGR of 26%/10%.

“Additionally the ICT industry is expected have double digit growth on account of increasing usage of technology, increasing digital penetration in Tier-2,Tier-3 cities and support from government. Overall the company has good financial track record and robust distribution network. Govt’s push towards digitisation and favourable industry factors makes this IPO an attractive proposition. We thus give a SUBSCRIBE rating for the issue,” the brokerage said.

Also Read: Rashi Peripherals IPO: 10 Key risks from RHP to consider before investing

Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decision.