RITES Limited

RITES OFS entails to sell up to 2,50,00,000 Equity Shares, in aggregate representing 10% of the total issued and paid-up Equity Share capital of the Company (“Base Offer Size”) on November 22, 2019 (“T Day”) (for non-retail investors only) and on November 25, 2019 (“T+1 Day”) (for retail investors and for non-retail investors who choose to carry forward their un-allotted bids).

There is option to additionally sell up to 1,25,00,000 Equity Shares (representing 5% of the total issued and paid-up Equity Share capital of the Company) as part of the “Oversubscription Option” and in the event the Oversubscription Option is exercised in RITES OFS

Updates

  • RITES OFS Retail gets .52x response
  • RITES OFS Receives a Mixed Response on Day 1 from Non retail Investors. Base offer subscribed 1.11 x , but Total offer response at .73x. for Non retail. Share Price at 293.9 ends close to Floor price of Rs. 293.5

About RITES OFS

Issue Period22-11: 25-11-2019
Face Value10
Floor Price293.5
MP a Day before306.65
% Discount of Floor Price4.48%
Base Offer (shares)25000000
Base offer Non Retail20000000
Base offer  Retail5000000
Base Offer in Rs. Crore734
Tot offer (shares) w Green Shoe3,75,00,000
Total Offer (crore)1,101
Total Non retail Shares3,00,00,000
Total retail shares75,00,000
Total retail in Rs. Cr.220
Discount to Retal 5%

About RITES Limited

  • RITES Ltd., a Government of India Enterprise was established in 1974, under the aegis of Indian Railways. RITES Limited is a Miniratna (Category-I) Schedule A’ Public Sector Enterprise
  • RITES is a multi-disciplinary consultancy organization in the fields of transport, infrastructure and related technologies.
  • RITES has undertaken various projects in over 55 countries across Asia, Africa, South America, Middle East etc.

RITES Financials:

Particulars / Rs Cr.Sep-19Jun-19Mar-19Dec-18Sep-18
Net Sales746.24537.65737.26534.92442.95
Other Income14332.259.1847.6535.27
Total Income889.24569.85796.44582.57478.22
Total Expenditure550.35403.28555.49378.58294.07
PBIDT338.89166.57240.95203.99184.15
Interest1.71.482.731.711.78
PBDT337.19165.09238.22202.28182.37
Depreciation11.2311.09109.859.48
Tax49.4352103.4658.9658.06
Deferred Tax39.32-0.08-25.62-2.342.96
Net Profit 232.5897.94150.38119.77107.65
EPS 9.34.97.265.995.38
Dividend (%)00000
Equity250200200200200
PBIDTM(%)45.4130.9832.6838.1341.57
PATM(%)31.7918.9920.425.3925.26

RITES OFS : Salient points and Assessment

  • Rites reported very Positive Financial performance in Sep-19.
  • The open offer has been necessitated as part of GOI Disinvestment program.
  • RITES IPO was at Rs. 185 in June 2018. Subsequently RITES has given Bonus in year 2019 in the ratio of 1:4.The share has been quoting ex-bonus from August 8, 2019.
  • Thus RITES share was almost doubled post listing in less than 1.5 years.
  • RITES is quoting near its life time high price making it bit risky and more so in view of sharp run up in last few weeks.
  • RITES Is not in F&O which could lead to price volatility post the OFS.
  • Retail has advantage of 5% discount in the OFS and can decide after seeing today’s response to RITES OFS

Standard disclaimer:  I am not a SEBI registered analyst. I may have vested interest in every stock I discuss. Please do your own due diligence as stock market investments have high degree of inherent risk.