CRP Risk Management IPO Review; Should you Invest?

Guiness Corporate Advisory Services, the leading merchant banker is expecting that IPO market will grow by leaps and bounds in the next two years. There has been a phenomenal change in the mindset of people who were earlier largely dependent on the debt related instrument. The new generation companies are adopting this strategy to raise funds for their expansion plans.  And now it seems Mumbai based CRP Risk Management Limited IPO is trailing the similar path. Here are the details for the same.

CRP Risk Management – A sneak peek 

Started in the year 2000, CRP Risk Management is a Mumbai based firm engaged in diversified business portfolio. The company verifies the critical information for large and mid-size corporates. The company initially offered services like background verification check and credit verification checks and later it became an integrated risk mitigation solution company that offers exemplary services to the clients. CRP Risk Management business is divided into three segments

• BFSI (Corporate)- related verification including retail and corporate loans, claim investigation
• Retail KYP Check for domestic services like drivers, electrician, etc
• Veterinary segment-the company offers poultry feed enzymes, animal and fish food and other related products

The promoter of the company is Mr.Hitesh Asrani.

Objective of the IPO

The company plans to raise an IPO to repay its debts availed, to expand its business operation, to meet the capital requirements, to build its infrastructure, to market its brand and for general corporate purposes.

CRP Risk Management IPO Details

The initial public offering of CRP Risk Management has already started on 18 January 2018. The public issue of Rs 51,36,000 equity shares of face value of Ra 10 each for each at a price of Rs 60 per equity share aggregating Rs 3081.60 lakhs. Out of which, 2, 68,000 shares will be reserved for subscription by market maker. The net issue will include 28.8% of diluted equity capital. The issue will close on 22 January 2018. The lead manager to the issue is Inventure merchant banker services and Beeline broking limited is the market manager to the issue. Here are the tabulated details for the same.

• Issue Open: Jan 18, 2018
• Issue Close: Jan 22, 2018
• Issue Type: Fixed Price Issue IPO
• Issue Size: 5,136,000 Equity Shares of Rs 10 aggregating up to Rs 30.82 Cr
• Issue Price: Rs 60 Per Equity Share  with Face Value of Rs 10 Per Equity Share
• Minimum Order Quantity: 2000 Shares
• Listing At: BSE – SME

Current IPO subscription status

Number of Bids Received
As on Date & Time	QIB	NII	RII	Others	Total
Shares Offered / Reserved	0	2,434,000	2,434,000	268,000	5,136,000
Day 1 – Jan 18, 2018 17:00 IST	0	792,000	1,472,000	–	2,264,000

Source – BSE

Financial details

The company is accumulating above 25% of the operating margins in the risk division. The company is expected to increase its contribution towards risk business by 70% in the FY 2018 and 80% in the FY 2019. On an pre-IPO basis, the company is valued at Rs 81 crore and post IPO it will be valued at Rs 105 crore.  The company registered a decent revenue growth of 10% in FY 2017 and EBDITA margins between 13-16% since FY 2013.

Should you invest?

The company is having a right blend of adequate workforce, state-of-the-art technology and company promoters to implement the ideas for risk mitigation at the earliest.  CRP Risk Management IPO reflects valuation amid high growth expectation. The IPO will definitely yield returns and is meant for long-time investors.

 

Disclaimer: The article is in no way an advice to buy or sell any stock; rather it provides a base for the investor’s own research. Consult with a registered investment advisor, prior to making any trading decision of any kind.