Plaza Wires sets price band of Rs 51-54 a share for Rs 71.3-crore IPO
Delhi-based Plaza Wires Ltd has announced its plans for an initial public offering (IPO) with a price band set at Rs 51 to Rs 54 per share. The IPO is valued at Rs 71.30 crore and is scheduled to open for subscription on September 29. This offering consists entirely of fresh issue shares, indicating that the company intends to raise capital by issuing new shares.
Before the IPO officially opens to the general public, there will be an anchor investor segment available on September 27. Anchor investors, typically institutional investors, are invited to subscribe to shares in advance of the public offering to boost investor confidence. The IPO subscription period will run until October 4. Plaza Wires Ltd aims to utilize the proceeds from the IPO to support its growth and business initiatives.
Plaza Wires Ltd is engaged in the manufacturing and sale of various products, including wires, LT aluminium cables, and Fast Moving Electrical Goods (FMEG) items. These products are marketed under well-known brands such as Plaza Cables, Action Wires, and PCG. The company operates a manufacturing unit located in Baddi, Himachal Pradesh, with an impressive annual production capacity of 1,200,000 coils.
The proceeds from the forthcoming initial public offering (IPO) will be directed towards a significant expansion plan. Plaza Wires Ltd intends to establish a new manufacturing facility dedicated to producing house wires, fire-resistant wires and cables, aluminium cables, and solar cables. This expansion is aimed at not only diversifying the company’s product portfolio but also catering to its growing operational requirements.
In the fiscal year 2020-21 (FY21), the company took a significant step towards realizing this expansion plan by acquiring approximately 7,902 square meters of land in Himachal Pradesh. This acquisition is earmarked for the construction of a new production unit, which is expected to contribute significantly to the company’s capacity. Upon completion, this new unit is projected to add an annual production capacity of 837,000 coils and approximately 8,700 kilometers of cables, further enhancing Plaza Wires Ltd’s capabilities to meet market demands and support its growth objectives.
Plaza Wires Ltd operates with a substantial network of 1,108 authorized representatives who play a crucial role in product sales and distribution. The company’s primary focus is on the industrial equipment wholesale industry, where it faces competition from established and well-known players. Some of its notable competitors include Finolex Cables Ltd, KEI Industries Ltd, Havells India Ltd, KEC International Ltd, R R Kabel Ltd, V-Guard Industries Ltd, and Polycab India Limited.
In terms of financial performance, as of December 2021, Plaza Wires Ltd reported a total revenue of Rs 126.69 crore. Despite generating significant revenue, the company reported a net profit of Rs 5.74 crore during the same period. It’s important to note that the company also disclosed its net debt position, which amounted to Rs 40.65 crore as of December 2021. This financial data provides insights into the company’s financial health and profitability.
Indeed, Plaza Wires Ltd’s competitive standing within its market and its financial performance are pivotal factors that potential investors and stakeholders carefully assess when gauging the company’s growth prospects and investment attractiveness.
In this context, it’s noteworthy that Pantomath Capital Advisors Private Limited is serving as the book running manager for Plaza Wires Ltd’s offering. The book running manager plays a critical role in managing the IPO process, including pricing the shares and coordinating with various parties involved. Their expertise and guidance can provide valuable insights to investors considering participation in the IPO.
Additionally, Kfin Technologies Limited has been appointed as the registrar for the offer. The registrar is responsible for managing various tasks related to the IPO, such as handling share allocation, processing refunds, and maintaining the records of shareholders. Their efficient administration of these processes can contribute to a smooth and transparent IPO experience for investors.
Investors and stakeholders will likely closely follow the developments surrounding Plaza Wires Ltd’s IPO, taking into account the company’s market competition, financial performance, and the support of experienced advisory and registrar firms in the offering. These factors will help them make informed decisions regarding their potential investment in the company.