Silgo Retail Jan. 26 RI review - (Not Rated)

•    This is the 3rd RI from the company since June 2018.
•    Last RI was in the month of February 2024.
•    The company is engaged in jewelry business, and now planning to enter solar power segment.
•    It posted growth in its top and bottom lines for the reported periods. 
•    Based on its recent financial data, the issue appears greedily priced.
•    There is no harm in skipping this pricey RI bet.

ABOUT COMPANY:
Silgo Retail Ltd. (AFL) has an established presence and a proven operating history in the jewelry business, supported by its brand recognition, customer relationships, and understanding of consumer markets, which provides it with a strong foundation to diversify into new business segments. It is entering the solar energy business as part of long-term strategy to diversify revenue streams and reduce dependence on a single business segment, while aligning itself with the growing demand for renewable and sustainable energy solutions. 

The company intends to adopt a scalable and efficient business model in the solar segment, leveraging third-party suppliers, technology partners, and contractors where appropriate, enabling it to optimize capital expenditure and manage operational risks. The offer document is silent on its manpower data.

ISSUE DETAILS:
The company is coming out with its 3rd Rights Issue (RI) of 7381359 equity shares of Rs. 10 each at a fixed price of Rs. 60 per share to mobilize Rs. 44.29 cr. The RI opens for subscription on January 14, 2026, and will close on February 04, 2026. The company is offering RI in the ratio of 3 for 10 to its eligible stakeholders as of the record date of January 05, 2026. The company is asking for 50% (Rs. 30 per share) payment on application for the number of shares applied. Balance 50% (Rs. 30 per share) to be paid by one or more subsequent calls as determined by company from time to time. Post allotment, RI shares will be listed on NSE. The company is spending Rs. 0.48 cr. for this RI process, and from the net proceeds, it will utilize Rs. 43.81 cr. for investment in SPV – Hare Krishna Creative Realty Pvt. Ltd.

The RI is solely lead managed by the company itself., and Bigshare Services Pvt. Ltd. is the registrar to the issue. 

Post-RI, company’s current paid-up equity capital of Rs. 24.60 cr. will stand enhanced to Rs. 44.99 cr. Based on the RI pricing, the company is looking for a market cap of Rs. 269.92 cr. 

FINANCIAL PERFORMANCE:
On the financial performance front, for the last two fiscals, the company has posted total income / net profit, of Rs. 35.03 cr. / Rs. 3.15 cr. (FY24), Rs. 44.37 cr. / Rs. 4.48 cr. (FY25). For H1 of FY26 ended on September 30, 2025, it earned a net profit of Rs. 2.52 cr. on a total income of Rs. 22.62 cr. The company marked growth in its top and bottom lines for the reported periods. Its NAV stood at Rs. 45.93 as of September 30, 2025.

DIVIDEND POLICY:
The company has not paid any dividends for the reported periods.  It will adopt a prudent dividend policy, based on its financial performance and future prospects. The offer document is silent on its dividend policy.

SCRIP PERFORMANCE: BASED ON NSE WEBSITE DATA: SCRIP CODE: SILGO (FV Rs. 10).
The scrip last closed on cum-right basis at Rs. 80.10 on January 02, 2026, and opened on an ex-right basis at Rs. 77.30 on January 05, 2026. Since then, it has marked a high/low of Rs. 80.90 / Rs. 70.21. The scrip last closed at Rs. 72.49 as of January 11, 2026. For the last 52 weeks’ it has posted a high/low of Rs. 82.55 / Rs. 24.73.  

The promoters’ holding has declined to 52.57% for quarter ended September 30, 2025, against 55.37% for the quarters ended with June 30, 2025.  Vested interest quarters are operating the counter and maintaining it above the RI price at a hefty P/E. The RI price is also exorbitant considering its market price track record.