Riddhi Display Equipments Limited Makes Weak Debut with 20.00% Decline, Lists at ₹80.00 Against Modest Subscription

Riddhi Display Equipments Limited, incorporated in 2006 engaged in manufacturing and supply of innovative solutions in display equipment including display counters, commercial kitchen equipment, and commercial refrigeration equipment serving retail, advertising, exhibitions, restaurants, cafes, supermarkets, hotels, hospitals, and institutional clients, made a weak debut on BSE SME on December 15, 2025. After closing its IPO bidding between December 8-10, 2025, the company commenced trading with a decline of 20.00% opening at ₹80.00 and touched ₹80.00 (down 20.00%).

Riddhi Display Equipments Limited Listing Details

Riddhi Display launched its IPO at ₹100 per share with minimum investment of 2,400 shares costing ₹2,40,000. The IPO received modest response with subscription of 4.91 times - individual investors at 7.95 times, QIB at 2.19 times, NII at 1.92 times.

First-Day Trading Performance

Listing Price: Riddhi Display opened at ₹80.00 representing decline of 20.00% from issue price of ₹100.00, matching Street expectations from grey market premium of zero indicating likely listing at par, reflecting weak market sentiment despite PAT growth of 105% in FY25, indicating concerns about valuation sustainability, profit surge quality, and competitive positioning in display equipment manufacturing.

Growth Drivers and Challenges

Growth Drivers:

Strong Growth Trajectory: Revenue increased 33% and PAT surged 105% between FY24 and FY25, exceptional ROE of 62.87%, robust ROCE of 58.40%, RoNW of 39.94%, healthy PAT margin of 16.53%, strong EBITDA margin of 27.68% demonstrating operational efficiency.

Diversified Product Portfolio: Comprehensive offerings across display counters contributing significantly to income serving restaurants, cafes, retail shops, and supermarkets, commercial kitchen equipment for hotels, restaurants, and hospitals, commercial refrigeration equipment expanding market reach.

Operational Capabilities: Experienced promoters and qualified technical team, consistent delivery of quality products, providing customized solutions with focus on after-sales service, well-established manufacturing facility in Gondal, strong marketing team, catering to clients from diverse sectors and industries.

Challenges:

Severe Listing Discount: Opening decline of 20.00% creating immediate investor losses, grey market premium was zero correctly predicting weak listing.

Profit Surge Concerns: PAT growth of 105% from ₹2.02 crore in FY24 to ₹4.14 crore in FY25 attributed to cost management and value-added tailor-made products raising sustainability questions, analyst review states issue appears fully priced.

Operational Limitations: Small paid-up equity capital post-IPO of ₹8.64 crore indicating longer gestation period for mainboard migration, high debt-to-equity of 1.04, total borrowings of ₹10.79 crore against net worth of ₹10.36 crore, significant promoter dilution from 99.99% to 71.43%, limited scale with just 55 employees.

Utilisation of IPO Proceeds

Capacity Expansion: ₹4.97 crore for capital expenditure towards interior work and purchase of equipment and machinery for setting up manufacturing-cum-assembly unit at Lucknow expanding geographical footprint, ₹3.79 crore for purchase of equipment, machinery, and software for upgradation of existing Gondal manufacturing unit.

Marketing Infrastructure: ₹1.43 crore for setting up showroom at Gondal enhancing market presence and customer engagement.

Working Capital: ₹9.74 crore for funding working capital requirements supporting inventory management, production, and business operations, ₹3.42 crore for general corporate purposes.

Financial Performance

Revenue: ₹25.09 crore for FY25, growth of 33% from ₹18.90 crore in FY24, reflecting expanding sales of display counters, commercial kitchen equipment, and refrigeration equipment across retail, hospitality, food service, and institutional sectors.

Net Profit: ₹4.14 crore in FY25, impressive growth of 105% from ₹2.02 crore in FY24, demonstrating operational leverage through cost management and value-added tailor-made products though analyst questions sustainability given competitive market.