Rajnish Wellness BSE SME IPO review (Apply at your own risk)

Review By Dilip Davda on Jun 20, 2018

Rajnish Wellness Ltd. (RWL) is currently engaged in the business of selling various products in the categories ranging from consumer durables to ayurvedic personal care products. Company’s major focus area is sexual wellness, energy revitalization and personal care products. Changing lifestyle and awareness of health and wellness is increasing demand for sexual wellness and energy revitalization products. Current product portfolio is concentrated on ayuvedic products. Company is exploring ethical market in sexual wellness and energy revitalization category. Recently, RWL newly launched Play win spary in this category. Company has very strong hold in Maharasthra, Uttar Pardesh, Karnataka, Bihar, Odisha, Delhi, Jharkhand, Madhya Pradesh, Uttarakhand, Haryana and West Bengal.

Company runs on asset light model and owns all the brands under its name. Rajnish is sourcing its all products from dedicated manufacturers since inception. It has outsourced all its manufacturing needs to various suppliers who are expert in particular product in India which enables company to adhere to the required specifications and quality in stipulated time.

RWL’s personal care products are sold under brand name like “PlayWin Capsules” , “PlayWin Condom”, “Rajnish Lotion”, “Rajnish Plus Lotion”, “Play Win Spray”, , “PlayWin Plus Capsules”, “PlaWin Oil”, , “PlayWin F Capsule”, “Kasaav Powder”, “SudantaDantManjan”, “Mithohar Liquid”, “Mithohar Tablets”, “Madamrit Hair Shampoo”, “Madamrit Hair Oil”, “Madamrit Hair Capsule” and Pia Lo Herb’s.

To part finance its plans for branding and advertising expenses, working capital and general corpus fund needs, RWL is coming out with a maiden IPO of 1261200 equity shares of Rs. 10 each at a fixed price of Rs. 95 per share to mobilize Rs. 11.98 cr. Issue opens for subscription on 25.06.18 and will close on27.06.18. Minimum application is to be made for 1200 shares and in multiples thereon, thereafter. Post allotment, shares will be listed on BSE SME. Issue is solely lead managed by Navigant Corporate Advisors Ltd. Bigshare Services Pvt. Ltd. is the registrar to the issue. Issue constitutes 26.99% of the post issue paid up capital of the company. Having issued initial equity at par, it raised further equity at a price of Rs. 20 per share (February 2018) and has also issued bonus in the ratio of 19 for 1 (January 2018). Average cost of acquisition of shares by the promoters is Rs. 7.08 per share. Post issue, RWL’s current paid up equity capital of Rs. 3.41 cr. will stand enhanced to Rs. 4.67 cr. As on 28.02.18 its debt equity ratio is 0.75:1.

On performance front, for last two fiscals, RWL has posted turnover/net profits of Rs. 13.16 cr./ Rs. 0.32 cr. (FY16), Rs. 25.30 cr. / Rs. 0.64 cr. (FY17). For first 11 months ended on 28.02.18 of FY18 it has earned net profit of Rs. 1.62 cr. on a turnover of Rs. 24.23 cr. For last two fiscals it has posted an average EPS of Rs. 5.34 and an average RoNW of 31.09%. Issue is priced at a P/BV of 2.15 on the basis of its NAV of Rs. 44.26 as on 28.02.18 and at a P/BV of 2.58 on the basis of post issue NAV of Rs. 36.77 (??).If we annualize latest earnings and attribute it on fully diluted equity post issue, then asking price is at a P/E of around 25. It has no listed peers to compare with. Issue appears fully priced.

On merchant banker’s front, this is the 14th mandate from its stable in last three fiscals. Out of last 10 listings 3 opened at discount and 7 opened at a premium ranging from 1.25% to 20% on the day of listing.


Conclusion / Investment Strategy

Considering fully priced issue, cash surplus risk savvy investors may consider investment on their own risk. (Other)

Review By Dilip Davda on Jun 20, 2018

Review Author

DISCLAIMER: No financial information whatsoever published anywhere here should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is purely for educational and information purposes only and under no circumstances should be used for making investment decisions. Readers must consult a qualified financial advisor before making any actual investment decisions, based on information published here. With entry barriers, SEBI wants only well-informed investors to participate in such offers. With crazy listings in the past, SME IPOs drew the attention of investors across the board. However, as SME issues have entry barriers and continued low preference from the broking community, any reader taking decisions based on any information published here does so entirely at own risk. The above information is based on information available as on date coupled with market perceptions. The Author has no plans to invest in this offer.

(SEBI registered Research Analyst-Mumbai).


About Dilip Davda

Dilip Davda

Dilip Davda is veteran journalist associated with stock market since 1978. He is contributing to print and electronic media on stock markets/insurance/finance since 1985.

Dilip Davda is a leading reviewer of public issues and NCDs in the primary stock market in India. The knowledge he gained over 3 decades while working in the stock market and a strong relationship with popular lead managers makes his reviews unique. His detail fundamental and financial analysis of companies coming up with IPO helps investors in the primary stock market. Dilip Davda has a special interest in analyzing the SME companies and writing reviews about their public issues. His reviews are regularly published online and in news papers.

Email: dilip_davda@rediffmail.com

Rajnish Wellness IPO FAQs

  1. 1. Why Rajnish Wellness IPO?

    The initial public offer (IPO) of Rajnish Wellness Limited offers an early investment opportunity in Rajnish Wellness Limited. A stock market investor can buy Rajnish Wellness IPO shares by applying in IPO before Rajnish Wellness Limited shares get listed at the stock exchanges. An investor could invest in Rajnish Wellness IPO for short term listing gain or a long term.

  2. 2. How is Rajnish Wellness IPO?

    Read the Rajnish Wellness IPO recommendations by the leading analyst and leading stock brokers.

  3. 3. Rajnish Wellness IPO what should investors do?

    Rajnish Wellness IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the Rajnish Wellness IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts in the above answer.

  4. 4. Is Rajnish Wellness IPO good?

    Sorry, we didn't rate the Rajnish Wellness IPO.

  5. 5. Is Rajnish Wellness IPO worth Investing?

    Our lead analyst Mr. Dilip Davda didn't rate the Rajnish Wellness IPO.

  6. 6. When will Rajnish Wellness IPO allotment status?

    The Rajnish Wellness IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit Rajnish Wellness IPO allotment status to check.

  7. 7. When will Rajnish Wellness IPO list?

    The Rajnish Wellness IPO will list on Monday, July 9, 2018, at BSE SME.








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