Government divests 12% stakes in RITES; IPO opens on June 20 -Governance Now

Government divests 12% stakes in RITES; IPO opens on June 20

As an initial public offering 25,200,000 equity shares are offered in which employee reservation portion is up to 1,200,000.

Praggya Guptaa | June 18, 2018

#divestment #mini ratna #PSU #railways #RITES #IPO

Snapshot of RITES growth over the years

The railway infrastructure consulting PSU, RITES Limited is coming up with its IPO on June 20, 2018, as the government of India is selling its 24 million equity shares (12%) stake in the Mini Ratna PSU. As an initial public offering 25,200,000 equity shares are offered in which employee reservation portion is up to 1,200,000.

Besides railways consulting, RITES has diversified into many areas for growth such as highways, metro, transport, port and highways, etc. for growth. Also expanded into renewable energy, RITES have also formed a company with the Ministry of Railways with 51 percent stake in it. Railway Energy Management Company Limited and taken project in 55 countries.

Commenting on the impact of the cost of EPC projects going down and business risks, Rajeev Mehrotra Chairman and Managing Director, RITES said, “Besides consultancy, we have added a lot of new expertise be it export or leasing as the situations. Concerning EPC cost going down, we have done enough risk management. We are sure of controlled growth of the company. We are a very conservative approach to the business growth. We have expanded only into those segments where there is a small credit risk. “On EPC said that company is working on fixed margins so cost fluctuation will not affect them. On risk part, he said he sees the payment realisation as the only risk.”

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