RNFI Services Ltd IPO: Review, Valuation, Opening Date & GMP

RNFI Services Limited IPO-Complete Overview

RNFI Services Limited IPO by RNFI Services Limited founded in 2015, is a financial technology corporation that provides B2B and B2B2C solutions via its web portal and mobile app. It focuses on offering financial, digital, and government-to-citizen (G2C) services throughout India. The company's business can be classified into four categories:

Services offered include business and non-business correspondents, full-service money changers, and insurance brokerage.

India is one of the world's fastest-growing economies, with a population of nearly 1.3 billion. The insurance business in the country is predicted to reach $280 billion by the year 2025, with a CAGR of 12%-15%. This growth is driven by increased knowledge of insurance's relevance and disposable incomes. The Indian government has developed policies to boost development and creativity in the insurance industry. 

As of July 2024, the company had formed partnerships with eleven financial institutions, including national private and public sector banks, as well as payment banks. These institutions work as business correspondents to deliver financial inclusion services.

As of the last day of March 2024, the company had processed more than 115 lakh transactions per month. As of June 3, 2024, it operates in 28 states and 5 union territories, encompassing 17,964 pin codes across the country via its distribution network. As of March 31, 2024, the company had 1,405 employees on an individual basis, which contributed significantly to its growth.

As of the 3rd of June 2024, the company had more than 360,000 network partners throughout India, offering a variety of tech-enabled services. The company offers transactional business correspondent services such as Domestic Money Transfer, Aadhaar Enabled Payment System, and Micro ATM, as well as kiosk banking and doorstep services for private sector banks performing e-KYC for prepaid cards and fastags. The company provides non-business correspondent services, including utility and travel-related services, EMI collection, defaulted loans, and selling products and services to address the demands of its network.

Dear readers, we are pleased to provide details about the approaching IPO. The company plans to launch its IPO on July 22, 2024. Let's take a closer look at the IPO's offerings below.

 

 

RNFI Services Limited IPO Overview

RNFI Services IPO is an SME book-built issue of Rs.70.81 crores comprising a wholly Fresh Issue of 67.44 lac Shares (amounting to Rs.70.81 crores) out of which 35% is allocated to retail investors, 50% to institutional investors, 15% to non-institutional-investors.

The IPO will be available to investors on July 22, 2024, and conclude on July 24, 2024. The anticipated listing date for the IPO is Monday, July 29, 2024, and will be held on the NSE and SME. The price range of each Share is Rs.98 to Rs.105.

If you want to apply for the IPO, Click Here to Open a Demat Account.

Company Financial

The company's revenue decreased by 11.81%, while profit after tax (PAT) increased by 103.82% during the financial years ending March 31, 2024, and March 31, 2023. 

Below is the synopsis of the company's financial data for the financial year ending March 31, 2024.

• The total revenue of the company is Rs.94,305.10 lac.

• The net worth of the company is Rs.3,159.90 lac.

• The company's EBITDA is Rs.1,923.88 lac.

• The total assets of the company are Rs.19,051.38 lac.

(Amount in lac)

Period	31 Mar 2024	31 Mar 2023	31 Mar 2022
Total Assets	19,051.38	12,526.71	11,661.34
Total Revenue	94,305.10	106,939.62	19,079.93
PAT	996.07	488.71	555.03
Net worth	3,159.90	2,041.64	1,330.24
Reserve & Surplus	1,350.86	2,043.47	1,332.07
Borrowing	3,638.87	2,118.75	1,264.05

 

Revenue Bifurcation

Below is the revenue breakdown for various activities:

(Amount in lac)

Net Cash Flow In Multiple Activities	FY 2024	FY 2023	FY 2022
Net Cash Flow Operating Activities	4,707.60	-2,009.33	2,017.25
Net Cash Flow Financing Activities	737.40	791.80	-599.46
Net Cash Flow Investing Activities	-2,615.11	-807.85	-37.55

Segment-wise Revenue From Operations Breakdown

Product-wise Revenue From Operations Breakdown:

[A] Business Correspondent Segment

 [B] Non Business Correspondent Segment

Revenue Breakdown From Other Segments

Breakdown Of Revenue From Sales Of Products

The Objective Of The Issue

The company desires to use the Net Proceeds from the Issue to fulfill its following goals:

• Funding the company's working capital and capital expenditures for purchasing micro ATMs, laptops, and servers.

• Enhancing its technological infrastructure to create new capacities.

• Creating inorganic expansion through unknown acquisitions and other strategic activities.

• General business objectives.

Peers Of RNFI Services Limited

(Figures as of March 31, 2024)

Company Name	Face Value (Rs.)	EPS (Rs.)	P/E (x)
Bls E-services Limited	10	4.44	55.30
Mos Utility Limited	10	4.17	37.15

 

Evaluation

The price of this IPO is Rs.98 to Rs.105 for each Share.

Evaluation Of P/E Ratio

Considering the Fiscal that concluded on 31 March 2024, with EPS of Rs.5.85 from the last year, the resulting P/E ratio is 17.94x.

Considering the weighted EPS of Rs.4.42 for the last three years, the P/E ratio is 23.75x.

Comparative Analysis With Listed Peers

The average P/E Ratio of the industry is 46.23x.

Particulars	P/E Ratio
Highest	55.30
Lowest	37.15
Average	46.23

In simple words, the P/E ratio of RNFI Services Limited-IPO (17.94x and 23.75x) when compared with the industry’s average P/E of 46.23x, has an undervaluation. Hence the price of the Share seems fairly priced for the investors when considered based on the average P/E ratio of the industry.

IPO's Strengths

• Its holistic business model offers a comprehensive solution for both B2B and B2B2C, with a diverse variety of products and services.

• A technology-driven company approach with a sophisticated digital platform.

• Experienced leadership supported by a talented professional team

• Asset-light and scalable business approach.

• A diverse distribution network extends across PAN India.

IPO’s Weaknesses

• Its banking partners contribute significantly to its revenue. The RBI regulates its banking partners, and any changes to its policies, decisions, or regulatory framework might harm its business, cash flows, operations, and financial conditions.

• Its reliance on IT systems can be badly impacted by vulnerabilities, difficulties, failures, or data breaches, thereby harming both operations and reputation. The company’s success depends on its ability to innovate, update, and adapt to new technologies.

• It generates revenue by charging clients fees and commissions for its services. Failure to generate money from such operations may negatively damage its financial performance.

• Security breaches and failures to protect personal, secret, and proprietary information could harm its reputation and negatively impact its business, financial situation, and operations.

• They have had negative cash flows from operations and may continue to do so, which might negatively affect their business, prospects, financial standing, cash flows, and results.

 

IPO GMP Today

RNFI Services Limited IPO’s latest GMP is Rs.85.

RNFI Services Limited IPO Timetable (Tentative)

The IPO is scheduled from July 22 to July 24, 2024, with allotment on July 25, refund initiation on July 26, and listing on July 29, 2024.

Events	Date
IPO Opening Date	July 22, 2024
IPO Closing Date	July 24, 2024
IPO Allotment Date	July 25, 2024
Refund initiation	July 26, 2024
IPO Listing Date	July 29, 2024

RNFI Services Limited IPO Details 

The IPO with a face value of Rs.10 per Share is set to start on July 22, close on 24 July, and offer a total issue size of 6,744,000 Shares (aggregating up to Rs.70.81 Cr) comprising a whole fresh issue size of 6,744,000 Shares (amounting to Rs.70.81 Cr).

IPO Opening & Closing Date	July 22, 2024 to July 24, 2024
Face Value	Rs.10 per Share
Issue Size	6,744,000 Shares (amounting to Rs.70.81 Cr)
Offer for Sale	NA
Fresh Issue	6,744,000 Shares (amounting to Rs.70.81 Cr)
Listing at	NSE, SME
Issue Type	Book Built Issue IPO
Registrar	Skyline Financial Services Private Ltd

 

RNFI Services Limited IPO Lot Details 

The IPO allows retail investors to invest in a minimum and maximum of 1 Lot (1200 Shares) amounting to Rs.126000 and in multiples thereof, while for HNI investors, the minimum Lot is 2 (2400 Shares) amounting to Rs.252000.

Minimum Lot Investment (Retail)	1 Lot
Maximum Lot Investment (Retail)	1 Lot
HNI (Min)	2 Lots

 

RNFI Services Limited IPO Reservation

Institutional Portion	50%
Retail Share Portion	35%
Non-Institutional Portion	15%

Promoters And Management Of RNFI Services Limited IPO

• Ranveer Khyaliya

• Nitesh Kumar Sharma

• Deepankar Aggarwal

• Rajan Kumar, Krishna Kumar Daga

• Charanjeet Singh

• Simran Singh Private Trust

Pre-Issue Promoter Shareholding	89.53%
Post-Issue Promoter Shareholding	-

RNFI Services Limited IPO Lead Managers

• Choice Capital Advisors Pvt Ltd

Dividend Policy

The company has not paid or declared any dividend in the last five financial years.

Conclusion

The company has seen negative cash flow in operating, financing, and investing activities in the last few financial years but has a diversified revenue generation in its business. To fulfill its objectives, the company is currently conducting an IPO for the general public.

We believe the information offered in this blog helps you learn about the company's financial performance. So this blog will be very useful to you if you are looking for information about the approaching IPO since it will give you reliable information about the company's, insights, financials, and past performance. If this informative blog piques your interest, you may be interested in reading our other related and useful posts on our website.

Finowings IPO Analysis

Hope you enjoyed the Finowings IPO Analysis. We tried our best to give every required detail about the company that you should know before applying to the IPO. 

You must consult your financial advisor before making any financial decisions. 

To Apply for the IPO, Click Here.

To Read the Prospectus of the Company Click Here to Download the DRHP.

 

We believe this blog would be very beneficial to you if you are looking for such information related to this upcoming IPO since this blog would provide you with accurate information about the company's, insights, financials, and past performance. If this informative blog matches your interest, you might be interested in reading our other related useful blogs on our website.

Disclaimer: This IPO analysis is only for informational purposes and should not be considered as investment advice. Always do your research and consult with a financial advisor.

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