Radiant Cash Management Services Limited

Radiant Cash Management Services Limited IPO Details

Radiant Cash Management Services Limited is an integrated cash logistics player with leading presence in retail cash management (“RCM”) segment of the cash management services industry in India and is one of the largest players in the RCM segment in terms of network locations or touch points served as of March 31, 2022.

Business Verticals:

Cash pick-up and delivery
Network currency management
Cash processing
Cash Vans/ cash in transit
Other Value added services

As of July 31, 2022, firm’s presence across 55,513 touch points across 13,044 pin codes covering 11,553 touch points in tier 2 and 36,220 touch points in tier 3+ towns and cities across all districts in India (other than Lakshadweep). Firm’s ability to offer RCM services across India, with presence in tier 2 and tier 3+ towns and cities has enabled them to attract some of the largest foreign, private and public sector banks in India as their clients.

Objective of the Issue

It is proposed that the Fresh Issue’s net proceeds be used as follows:

Funding working capital requirements.
Funding of capital expenditure requirements for purchase of specially fabricated armoured vans.
General Corporate purposes.

The object of the Offer for Sale is to allow the Selling Shareholders to sell up to 33,125,000 Equity Shares held by them.

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The Radiant Cash Management Services Limited IPO’s bid period is from December 23, 2022, at 10:00 A.M., to December 27, 2022, at 5:00 P.M. UPI Mandate confirmation must be received by 5 PM on the day the issue closes.

EBITDA & PAT (in Crs)

EBITDA– Earnings Before Interest Tax Depreciation & Amortization PAT – Profit After Tax

Total Assets, Share Capital and Borrowings (in Crs)

Revenue Growth (in Crs)

Peer Comparison

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Analysis:

If we analyse the financial parameters then it can be seen that the EBITDA margin, PAT margin & Revenue decreases in FY 2021 due to covid lockdown however, it increased in FY 2022 with levels greater than FY 2020. However, total assets keeps on increasing consistently YoY basis.

Taking the EPS as 3.77 as per RHP till March 2022, PE ratio is 24.68 which is on the higher side in comparison to the PE ratio of its peer. This simply depicts that the IPO price is on the higher side but we cannot make any decision without considering other fundamental parameters.

RoNW of 27.34% is highest among the peers & EBITDA margin of 20.73% is second among its peers. However, its revenue is lowest in the segment. Though PAT margin and ROE of 27.34 is good. However, looking at the current trend of its peers it seems both are in running correction. Also, the overall condition of the market is not favourable too. So its better to avoid this IPO for now.