Rishabh Instruments IPO hits Street; should you subscribe?

Rishabh Instruments, a manufacturer of test and measuring instruments, launched an initial public offer (IPO) worth up to Rs 491 crore on Wednesday. The IPO comprises fresh issuance worth up to Rs 75 crore, and an offer for sale (OFS) worth Rs 416 crore by promoters and existing investors.

Investors including Asha Narendra Goliya, Narendra Rishabh Goliya (HUF), Rishabh Narendra Goliya, and SACEF Holdings II will offload shares through the OFS portion, according to the company's red herring prospectus (RHP).

Here are some of the key details to know about the IPO:

Rishabh Instruments IPO Subscription Status

On Day 1 (August 30) of the subscription, qualified institutional bidders (QIB) subscribed the Rishabh Instruments IPO by 0.01 times. The IPO's non institutional investor portion was subscribed by 1.25 times, while its retail portion was subscribed by 0.96 per cent.

On Day 2 (August 31) of the subscription, qualified institutional bidders (QIB) subscribed the Rishabh Instruments IPO by 0.22 times. The IPO's non institutional investor portion was subscribed by 4.65 times, while its retail portion was subscribed by 2.80 per cent as of 5:14 PM.

Rishabh Instruments IPO: Important dates

The bidding process of the IPO, which opened for subscription on August 30, will end on September 1.

The basis of the allotment of shares is likely to be finalised on September 6, and the credit of shares set to take place on September 8.

Rishabh Instruments shares will likely be listed on the bourses BSE and NSE on September 11.

Rishabh Instrument IPO: Issue price

Under the IPO, potential investors can bid for Rishabh Instruments shares in a price band of Rs 418-441 apiece, in multiples of 34, translating to Rs 14,212–14,994 per lot.

Fund utilisation

Rishabh Instruments will use the proceeds from the fresh issuance towards the expansion of its manufacturing facility in Nashik, and general corporate purposes.

Investors reservation

While up to 50 per cent of the IPO is reserved for qualified institutional buyers (QIB), at least 15 per cent is kept for non-institutional investors (NII), and the remaining 35 per cent for retail investors.

Anchor investors

Ahead of the launch of the IPO, the company garnered about Rs 147 crore by allotting shares to anchor investors at Rs 441 apiece.

Should you apply for the Rishabh Instruments IPO?

Zee Business Managing Editor Anil Singhvi recommends applying for the issue for small listing gains and for the long term. He has identified the following key points about the company:

Positive:

• Experienced and clean promoters
• Strong financial growth record
• Strong anchor book
• Reasonable valuations

Negative:

• Plants in Polland and China
• Almost 70 per cent of revenue from exports

#IPOAlert

आज से #RishabhInstruments का IPO, प्राइस बैंड : ₹418-441/शेयर

Rishabh Instruments में निवेशक क्या करें?

ऋषभ इंस्ट्रूमेंट्स इश्यू को सब्सक्राइब करें या नहीं?

कंपनी में पॉजिटिव और निगेटिव क्या हैं?

ऋषभ इंस्ट्रूमेंट्स IPO पर अनिल सिंघवी की राय@AnilSinghvi_ pic.twitter.com/WAsAMFTjsd

— Zee Business (@ZeeBusiness) August 30, 2023

Advisors

DAM Capital Advisors, Mirae Asset Capital Markets (India), and Motilal Oswal Investment Advisors Ltd are acting as the book-running lead managers to the issue.

What does Rishabh Instruments do?

The Nashik-based company is focused on electrical automation, metering and measurement, and precision-engineered products with diverse applications across industries including power and automotive. It is one of the leading companies in terms of manufacturing and supply of low-voltage current transformers and analog panel meters.

Rishabh Instruments registered revenue of Rs 579.78 crore for the year ended March 2023 as against Rs 479.92 crore for the previous year. Its profit after tax stood at Rs 49.69 crore for the year 2022-23 as against Rs 49.65 crore a year ago, according to the RHP.

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