Started in 2015, Rajnish Wellness Limited, is a Mumbai based company, engaged in the business of selling various products in the categories ranging from consumer durables to Ayurvedic personal care products. Company’s major focus area is sexual wellness, energy revitalisation and personal care products. Current product portfolio is concentrated on Ayurvedic products. Rajnish wellness has very strong hold in Maharastra, Uttar Pradesh, Karnataka, Bihar, Odisha, Delhi,Jharkhand, Madhya Pradesh, Uttarakhand, Haryana and West Bengal. Their products are available in all major medical stores in these states. Company run on asset light model and owns all the brands under its name. Rajnish is sourcing its all products from dedicated manufacturers since inception. It has outsourced all its manufacturing needs to various suppliers who are expert in particular product in India which enables company to adhere to the required specifications and quality in stipulated time. Company has product portfolio that covers major products including Ayurvedic medicines, personal care products, sexual wellness and energy revitalisation items etc. They sell the personal care products under brandname. 'PlayWin Capsules' , 'PlayWin Condom', 'Rajnish Lotion', 'Rajnish Plus Lotion', 'Play Win Spray',, 'PlayWin Plus Capsules', 'PlaWin Oil', 'PlayWin F Capsule', 'Kasaav Powder', 'Sudanta Dant Manjan', 'Mithohar Liquid', 'Mithohar Tablets', 'Madamrit Hair Shampoo', 'Madamrit Hair Oil', 'Madamrit Hair Capsule' and Pia Lo Herb's. Still it is a constant endeavour of the Company to spread itself at the unrepresented areas through appointment of new distributors. Having business opportunities and rapid increase in the number of customers using internet as a platform for their buying needs, Company tied up with various e-commerce websites like snapdeal.com, indiamart.com, clickoncare.com, lovenaturalremedies.com, ayurvedmart.com and fineyog.com etc. to sell their products. As on February 28, 2018, Company had 18 permanent employees and 78 contract based employees. As per financial performance, company has posted total income/net profits of Rs. 13.15 cr. / Rs. 0.32 cr. (FY16) and Rs. 25.29 cr. / Rs. 0.64 cr. (FY17). For the period upto 28.02.18 of FY18, it has earned net profit of Rs. 1.62 cr. on a turnover of Rs. 24.23 cr. So financials are available for past 3 years only. For last two fiscals, it has posted an average EPS of Rs 5.34 and an average RoNW of 31.09%. Issue is priced at P/BV of 2.15 based on its NAV of 44.26 as on 28.02.18 and at a P/BV of 2.58 on the basis of post issue NAV of 36.77. If we annualise latest net profit of FY18 and attribute it on fully diluted equity post issue, then asking price is at a P/E of around 25. As per RHP, it has no listed peers and issue looks fully priced. On BRLM's front, for Navigant Corporate Advisors Ltd, this is the 14th IPO and from last 10 IPOs, 3 listed at below issue price and remaining with 2% to 20% premium on the day of listing. As of now, from recent 10 IPOs, 8 are trading below issue price and remaining above issue price. ( As on 20.06.18 ) As per financials, company's performance is good, but with same top-line higher bottom-line in FY18 raises concerns, RoNW is 31.09% for last two fiscals and issue is fully priced as per latest earnings. Performance of BRLM in recent past is poor and most IPOs which listed above issue price are trading below issue price. So we give AVOID rating to this SME IPO as per current market situation.
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