27 Jun , 2022 By : Kanchan Joshi
MUMBAI : RP Tech (Rashi Peripherals Pvt. Ltd), a pan-India distributor for AMD, JBL, Nvidia, Dell, Lenovo, and Fitbit, is planning an initial pubic offering (IPO) to raise as much as Rs1,000 crore, two people aware of the development said.
Founded by Krishna Choudhary and Suresh Pansari in 1989, RP Tech is one of India’s five largest IT distributors and service providers. The company works with more than 30 top global technology brands. It has a network of 50 branches and 50 service centres serving more than 9,000 dealers across the country.
“RP Tech has hired investment banks JM Financial and ICICI Securities to advise it on the proposed IPO. Work on the draft red herring prospectus has already started. While the final contours of the deal are yet to be decided, it is expected that the company could raise as much as Rs1,000 crore, which will be a mix of primary and secondary share sale," one of the two people mentioned above said.
Emails sent to RP Tech and its senior management on Friday remained unanswered.
“While the company predominantly deals in personal computers, peripherals, and components, it has been adding new brands and product categories to its portfolio. The disruptions caused by covid has led to significant demand for IT hardware both from corporates and public, leading to a strong rise in revenue for distributors. Also, while the supply chain issues have led to price hikes, margins are protected, as any price hike is completely passed on to customers," said the second person mentioned above.
For FY21, RP Tech reported a revenue of Rs5,865.59 crore, compared to a revenue of Rs3,918.42 crore in the previous fiscal. It reported a profit of Rs122.31 crore in FY21, jumping multi-fold from a profit of Rs42.16 crore in the last fiscal, as per a credit rating report from Crisil, dated 31 August, 2021.
“RPPL (Rashi Peripharals Pvt Ltd) have a long-standing relationship with principals such as Lenovo, Asus, Hewlett-Packard, Sandisk, and Western Digital. RPPL also has made significant vendor additions in the recent past, including brands such as Samsung and LG. CRISIL Ratings believes that RPPL will further improve its business risk profile over the medium term, on the back of its established market position in the domestic IT hardware distribution business and continued healthy demand for its products," the rating agency noted in its report.