The highly anticipated RNFI Services IPO opens today, marking a significant milestone for the financial technology company established in 2015. The IPO aims to raise ₹70.81 crore through a fresh issuance of 67.44 lakh shares. Investors can subscribe to the IPO from July 22 to July 24, 2024, with a price band set between ₹98 and ₹105 per equity share.
Key Details of the RNFI Services IPO
RNFI Services is set to offer 67.44 lakh shares, aiming to raise ₹70.81 crore. The allocation of shares is segment into various categories:
- Qualified Institutional Buyers (QIBs): Up to 12.72 lakh shares.
- QIB Anchor Portion: Up to 19.08 lakh equity shares.
- Non-Institutional Investors (NIIs): Up to 9.54 lakh shares.
- Retail Individual Investors (RIIs): Up to 22.26 lakh shares.
- Market Maker: Up to 3.84 lakh shares.
Investors can bid for a minimum of one lot, equivalent to 1,200 equity shares worth ₹1.17 lakh, and in multiples thereafter. This structure ensures that various types of investors, from institutional to retail, have opportunities to participate.
Timeline and Subscription Details
The bidding period for the RNFI Services IPO spans from July 22 to July 24, 2024. The timeline for key events post-subscription is as follows:
- Allotment Finalisation: July 25, 2024.
- Refund Initiation: July 26, 2024.
- Demat Transfer: July 26, 2024.
- Listing Date: July 29, 2024.
The company’s shares will be listed on the NSE SME, providing investors with an exit route and liquidity.
Utilisation of IPO Proceeds
The net proceeds from the IPO will be strategically utilized to support various growth and operational objectives:
- Working Capital Requirements: A significant portion will be allocate to meet the company’s day-to-day operational needs.
- Capital Expenditure: Funds will be use for purchasing micro ATMs, laptops, and servers, enhancing the technological infrastructure of the company.
- Strengthening Technology Infrastructure: Investing in new technologies to expand capabilities and improve service delivery.
- Inorganic Growth: Funds will also be allocate for acquisitions and other strategic initiatives to drive growth.
- General Corporate Purposes: The remaining funds will be use for general corporate needs, ensuring the company’s smooth operational flow.
About RNFI Services
RNFI Services was established in 2015 with a mission to provide technology-enabled financial technology solutions. The company operates in the B2B (business-to-business) and B2B2C (business-to-business-to-consumer) sectors through an integrated business model via a mobile application and an online portal.
The firm focuses on delivering comprehensive banking, government-to-citizen (G2C), and digital services nationwide. RNFI Services operates through four key segments:
- Full-Fledged Money Changer: Providing currency exchange services.
- Business Correspondent Services: Offering banking services in partnership with banks.
- Non-Business Correspondent Services: Facilitating financial services without bank partnerships.
- Insurance Broking: Conducted through Reliassure Insurance Brokers Private Ltd.
RNFI Services’ innovative approach bridges the gap between tech-enabled financial services and underserved populations, ensuring accessibility even in remote areas. The company empowers shopkeepers and network partners to offer essential banking, digital, and government services through user-friendly web and mobile applications.
Financial Performance and Market Position
RNFI Services has shown a mix of highs and lows in its financial performance over the past three fiscal years:
- FY22: Total income of ₹190.80 crore and net profit of ₹5.55 crore.
- FY23: Total income of ₹1,069.40 crore and net profit of ₹4.89 crore.
- FY24: Total income of ₹930.03 crore and net profit of ₹9.96 crore.
Despite fluctuations, the company has maintained an average EPS of ₹4.42 and an average RoNW of 39.36%. The IPO is priced at a P/BV of 6.05 based on its NAV of ₹17.35 as of March 31, 2024, and at a P/BV of 2.56 based on its post-IPO NAV of ₹41.04 per share at the upper cap.
The company’s strong foothold in the fintech industry, coupled with its focus on retail money exchange and financial inclusion, presents promising growth opportunities. Despite the IPO being fully price, the company’s prospects for scaling performance make it an attractive medium to long-term investment.
The Future of RNFI Services
Ranveer Khyaliya, Chairman & Managing Director of RNFI Services Ltd, expressed his enthusiasm about the IPO, stating, “It’s an immense pleasure to share this significant milestone in our journey as we prepare for our IPO. Since our inception, our mission has been to bridge the financial gap in rural India, bringing accessible and innovative financial technology solutions to the underserved. Our dedicated team and extensive network have enabled us to reach over 28 states and 5 union territories, processing more than 115 lakh transactions monthly to date.”
Khyaliya emphasized that the IPO marks a new chapter in the company’s journey. The funds raise will be use to enhance service offerings, expand the network, and continue the commitment to empowering rural India. The company aims to make a greater impact on the financial landscape of India through technological innovation and financial inclusion.
Conclusion
The RNFI Services IPO is a significant opportunity for investors looking to tap into the growing fintech sector in India. With a robust business model, a strong presence across the country, and a focus on technological advancement and financial inclusion, RNFI Services is well-positioned for future growth. The IPO proceeds will enable the company to enhance its capabilities and expand its reach, contributing to its mission of creating a “DIGITAL BHARAT.”
As the RNFI Services IPO opens for subscription, it presents a compelling case for both institutional and retail investors. The structured allocation of shares ensures broad participation, and the strategic use of funds promises to drive further growth and innovation. Investors looking to capitalize on the evolving fintech landscape may find the RNFI Services IPO a worthwhile addition to their portfolios.
