Ascent Capital-backed Radiant Cash Management Services files draft papers for IPO

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Ascent Capital-backed Radiant Cash Management Services filed its Draft Red Herring Prospectus (DRHP) with capital markets regulator Sebi to launch its initial public offering (IPO). The Chennai-based firm intends to issue up to Rs 60 crore worth of new shares, while existing shareholders may sell up to 30.13 million equity shares. The OFS comprises issue of up to 10.13 million shares by Col. David Devasahayam and up to 20 million shares by Ascent Capital Advisors India.

The proceeds from the issue worth Rs 20 crore will be used for funding working capital requirements, Rs 23.92 crore towards for funding of capital expenditure and for general corporate purpose.

In 2015, private equity firm Ascent Capital, a leading PE fund acquired 37.2 percent holding in the company.

Founded in 2005 by Col. David Devasahayam, Radiant Cash Management Services (RCMS) is an integrated cash logistics player with leading presence in retail cash management (RCM) segment of the cash management services industry in India and one of the largest players in the RCM segment in terms of network locations or touchpoints served as of July 2021.

It operates its business across five verticals, namely cash pick-up and delivery; network currency management (also known as cash burial in industry parlance); cash processing; cash vans /cash in transit and other value added services.

Company info

The senior management team of the company is led by Col. David Devasahayam, CMD of the company since its incorporation.

The company has marquee clients, which includes some of the largest foreign, private and public sector banks, and the end-user of our services include some of the largest e-commerce companies, retail chains, NBFCs, insurance firms, e-commerce logistics players, railways and retail petroleum distribution outlets.

As of July 31, 2021, Radiant has more than 42,420 touch points across 12,150 pin codes covering tier 2 and tier 3+ towns and cities across all states and union territories in India (other than Lakshadweep). The company is managed by a team of highly professional ex-army senior management with 1,761 employees and 6,056 cash executives on contract.

According to DRHP, the Indian cash management services market revenue grew at a CAGR of more than 10% during the period between fiscal 2010 and fiscal 2021, growing from approximately Rs 10.0 billion to Rs 27.7 billion during this period.

Radiant Cash Management Services’ revenue from operations stood at Rs 221.67 crore during the year ended March 2021, while its profit after tax during the year stood at Rs 32.43 crore.

As on June 30, 2021, our net worth stood at Rs 1,09.14 crore and as of July 31, 2021. It had a fleet of 694 specially fabricated armoured vans through a combination of leased vehicles and on a short term contractual basis.

IIFL Securities Limited, Motilal Oswal Investment Advisors Limited and Yes Securities (India) Limited are the book running lead managers to the issue.