IT hardware distributor Rashi Peripherals lists 9% higher over issue price

ICT distributor Rashi Peripherals made a decent debut with its shares listing at a 9 per cent premium on NSE in Wednesday's trade. The stock listed at Rs 339.50 against the issue price of Rs 311.

The stock of the computers hardware and equipments company opened at Rs 335 on the BSE.

Post listing, the stock hit a high of Rs 340 and a low of Rs 320.05 on the BSE. At 10:01 am; Rashi Peripherals was trading at Rs 334, up 7.5 per cent over its issue price.

In comparison, the S&P BSE Sensex was down 0.70 per cent at 71,065.

The company raised Rs 600 crore through the fresh issue. It will use part of the proceeds to reduce debt (Rs 326 crore) and fund working capital requirement.

This will significantly reduce the Debt/Equity ratio to 0.8x on post issue capital, according to analysts.

Rashi Peripherals is the fourth largest player in the distribution business of information and communications technology (ICT) products and services in India.

It generates around 85 per cent of the business from the B2B2C channel. It commanded a dominant market share in some of the ICT products.

"The company intends to continue with a considerable market share as one of its strategies for product category expansion. Use of IPO proceeds would lower the financial liabilities, whereas availability of working capital would boost the business expansion capabilities in the medium-term", said Choice Equity Broking in an IPO note.

The initial public offer (IPO) of Rashi Peripherals received strong response from the investors with 62.95 times subscription.

The Qualified Institutional Buyers (QIBs) category was subscribed 151.45 times. The Non Institutional Investors (NIIs) category was subscribed 66.15 times. The Retail Individual Investors (RIIs) category was subscribed 11.01 times.

The company has 50 branches operating as sales and as service centers and 63 warehouses covering 680 locations in India through an ecosystem of 8,402 channel partners for 10,508 stock keeping units as of September 30, 2023.

The company’s partnership covers various product categories, including personal computing, mobility, enterprise, embedded solutions, components, lifestyle, storage, memory devices, power, and accessories.

These brands include ASUS Global, Dell, HP, Lenovo, Logitech, NVIDIA, Intel, Western Digital, Schneider Electric, Eaton, ECS, Belkin, TPV, LG Electronics, Toshiba, Harman International and more.

Globally, the electronics and ICT products market is expected to grow at a CAGR of 14 per cent between 2020 and 2025 and is projected to cross approximately $350 billion in sales by 2025.

Growth in demand for storage devices, laptops, accessories, networking devices and artificial intelligence machines are expected to drive the demand for ICT products in India going forward.