Saturday, November 17, 2012

Life after unsucesful Delisting : Ricoh India

Ricoh India came out with delisting offer, Which closed on 20th November 2012. The required shares in delisting offer was at least 65 lakhs shares, whereas they were able to garner only 40 lakhs shares out of almost 105 lakhs shares.

Ricoh Production Print Solutions

The delisting in this stock was unsuccessful due to lower participation by retail public in delisting offer. What is to be noted that the floor price of Ricoh India was Rs 53.79 /- and as per media reports they wanted to increase the offer price to minimum Rs 95 /- , which was declined by exchange authorities because the request to revise the offer price was given on the eve of opening of offer.

The price at which, it  was quoting was in the range of Rs 75/- - Rs 85/- during the period after the announcement of delisting, it is now quoting at Rs 53/-.

Is there anything in store for us ?

a) The Delisting offer was voluntary as they hold 73.60% in the company , below the 75% mark for compulsory delisting.

b) Ricoh India is subsidiary of Ricoh of Japan, It has almost 1 lakh employees and it has reach in all geography.

c) The company is in proving Office automation solution (Multifunction , Copiers, Printer, Facsimile, Printers, Projectors) along with digital cameras and Managed Document Service.

d) Company is also engaged in huge advertising of Digital cameras and they have captured a good share in market.

e) The company has recently taken over a small company InfoPrint Solutions P Ltd, which gives printing solutions to corporates.

f) The Company is making losses since 2 quarters which happens for most delisting candidates also 

g) Q3 FY12 sales have gone up by almost 63 % (Partially because of merger of Infoprint solution P Ltd).

h) The company has small long term debt, Current liabilities and Current assets have mismatch, in fact they have negative working capital ? Need to look at it minutely.

The company seems to have multiple growth triggers and we can also bet on commitment of the company as they were ready to delist the stock.

Also the company has low floating stock and there are probabilities that they may try to delist again in future, The returns on stock will be more for investors, if it remains listed in long run.

This is not the recommendation to anybody whatsoever to buy or sell this share, but it is my thought process and views on this topic.

I welcome your critical comments and suggestions.


  1. Hi

    Do you know any rule about how soon company can try to delist again after failure.

    Means i think it cannot be in 3 or 6 month.

  2. Dear Rohit,

    There is no mention of cooling off period in SEBI delisting guidelines, in the case of unsuccessful de- listing.

    As of now SEBI is silent about companies whose compulsory delisting has been unsucessful and they have to meet June,2013 deadline to either delist the company of reduce the Shareholding.

    Once SEBI gives guidelines on above issue, it will also clear doubt on cooling of period for voluntary delisting also.

    But as per current rules, If any company wants to go for delisting again, they will have to go through whole delisting process again.


    Jigam Gandhi