By this move, the Government wants to get rid of its major stake in this PSU. The aim is to raise more than g Rs 460 crore by selling 2.52 crore shares at Rs 180-185 per share in the three-day offer.
By this, the Government’s stake will be reduced by 12.6 percent.
The shares will be listed on on BSE and NSE. The money raised will go to the Government of India only.
The prime objectives of carrying out the offer is to disinvest about 2.4 crore equity shares that is held by the government, which is equals to 12 percent of the paid up share capital as part of the net offer, and 12 lakh shares that will be kept aside for employee reservation.
Why you should invest?
- RITES is a profitable Miniratna PSU which is showing constant growth since the last five years.
- It has orders worth Rs 4,800 crore that gives revenue visibility for the next two-three years, reasonably good financial performance.
- The company has also undertaken projects in 55 countries, including in the Asian, African, Latin American, and the Middle East regions.
- It has a strong client base and mainly caters to the Indian Railways. The high investment budget of the railways works in favour of the company.
In the past four years ending FY17, the company’s revenues have grown at a compounded annual growth rate (CAGR) of 9 per cent to Rs 1,353 crore. Also, its net profit has grown at a CAGR of 11 per cent to Rs 362 crore in FY17.