RNFI Services, a financial technology company offering B2B and B2B2C solutions, is set to launch its IPO on the NSE SME platform. This blog dives into the details of the offering, helping you decide if it aligns with your IPO investment goals.
About RNFI Services
- Incorporated in 2015, RNFI Services leverages technology to provide banking, digital, and government services across India.
- The company operates through a network of over 360,000 partners, offering services like domestic money transfers, Aadhaar-enabled payments, and micro ATM operations.
- RNFI Services reported a decrease in revenue but an increase in profit after tax for the financial year ending March 31, 2024, compared to the previous year.
RNFI Services IPO fundamentals
- Issue Size: ₹70.81 crore (fresh issue only)
- Price Band: ₹98 - ₹105 per share
- Minimum Lot Size: 1200 Shares (₹117,600 minimum investment)
- Listing: NSE SME (tentative date: July 29, 2024)
RNFI Services financials
- Revenue: Decreased by -11.81% compared to FY23
- Profit After Tax (PAT): Increased by 103.82% compared to FY23
- Market Capitalization: ₹262 Cr
Use of proceeds from the RNFI Services IPO
- Working Capital Requirements
- Capital Expenditure for Technology Infrastructure
- Inorganic Growth (acquisitions)
- General Corporate Purposes
Key considerations of the RNFI Services IPO
- Revenue Decline: The recent decrease in revenue despite a PAT increase needs to be investigated. Understand the reasons behind this and future growth prospects.
- SME Listing: RNFI Services is listing on the NSE SME platform, which caters to smaller companies with typically lower liquidity compared to the main NSE board.
- Fintech Potential: The fintech sector offers promising growth prospects in India. However, competition is high, and RNFI Services' ability to compete effectively will be crucial.
RNFI Services IPO: should you invest?
- Investors with a High-Risk Appetite: SME IPOs generally involve higher risks. Investors comfortable with such risk can consider this opportunity.
- Investors Bullish on Fintech: Those who believe in the growth potential of the Indian fintech sector might find this IPO interesting.
- Long-Term Investors: Given the listing on the NSE SME platform, liquidity might be lower. This investment is suitable for those with a long-term horizon.
Further research
- Read the company's DRHP (Draft Red Herring Prospectus) for a detailed understanding of its business model, financials, and risk factors.
- Look for analyst reports and news articles to gain insights into the competitive landscape of the Indian fintech sector.
Conclusion
RNFI Services IPO offers an opportunity to invest in a growing fintech company. However, a recent decline in revenue and the SME listing platform require careful consideration. Thorough research and a high-risk tolerance are essential before subscribing to this IPO.
Disclaimer: This blog is for informational purposes only and should not be considered financial advice. Investing in the stock market carries inherent risks, and it's essential to conduct thorough research or consult with a qualified financial advisor before making any investment decisions.
