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16 December 2023

Plaza Wires IPO: Powering Growth with Every Strand

Introduction:

Plaza Wires IPO, a book-built issue raising Rs 71.28 crores, is a testament to the company's vision. The IPO consists entirely of a fresh issue of 1.32 crore shares, marking a significant step in Plaza Wires' growth journey. The bidding phase spanned from September 29, 2023, to October 5, 2023, with allotment finalized on October 9, 2023. Plaza Wires proudly made its market debut on both BSE and NSE on October 12, 2023.

Pricing Dynamics:

With a price band set at ₹51 to ₹54 per share, Plaza Wires IPO catered to a diverse investor base. The minimum lot size for an application was fixed at 277 shares, requiring a minimum investment of ₹14,958. For savvy Non-Institutional Investors (NIIs), the minimum investment for small (sNII) and big (bNII) categories was 14 lots (3,878 shares) and 67 lots (18,559 shares), amounting to ₹209,412 and ₹1,002,186, respectively.

Market Performance Overview:

As of December 15, 2023, Plaza Wires Limited (PLAZACABLE) was quoted at ₹100.95, showcasing a 1.00% increase. The stock opened at ₹101.50, experienced a high of ₹102.50, and a low of ₹100.00. The previous close was ₹99.95, with a total traded value of 2,13,771. The 52-week range revealed a high of ₹173.50 on November 1, 2023, and a low of ₹75.70 on October 12, 2023.

Key IPO Highlights:

- IPO duration: September 29, 2023, to October 5, 2023
- Listing Date: October 12, 2023
- Face Value: ₹10 per share
- Price Band: ₹51 to ₹54 per share
- Lot Size: 277 Shares
- Total Issue Size: 13,200,158 shares, aggregating up to ₹71.28 Cr
- Fresh Issue: 13,200,158 shares, aggregating up to ₹71.28 Cr
- Issue Type: Book Built Issue IPO
- Listing At: BSE, NSE

Equity Transition:

Pre-IPO, Plaza Wires boasted 30,551,920 shares. This shifted post-issue to 43,752,078 shares, marking a significant expansion.

IPO Reservation Dynamics:

The IPO allocation was strategically distributed, with 13,200,158 shares on offer. This included 6,196,076 (46.94%) for Qualified Institutional Buyers (QIBs), 1,980,023 (15.00%) for NIIs, 1,320,015 (10.00%) for Retail Individual Investors (RIIs), and 3,704,044 (28.06%) for Anchor investors.

IPO Anchor Investors Details:

Plaza Wires IPO garnered substantial support from anchor investors, raising Rs 20.00 crores. The anchor bidding took place on September 27, 2023. The anchor lock-in period for 50% shares is until November 22, 2023, and for the remaining shares, it extends until February 16, 2024.

IPO Timeline Snapshot:

- IPO Open Date: Friday, September 29, 2023
- IPO Close Date: Thursday, October 5, 2023
- Basis of Allotment: Monday, October 9, 2023
- Initiation of Refunds: Wednesday, October 11, 2023
- Credit of Shares to Demat: Thursday, October 12, 2023
- Listing Date: Thursday, October 12, 2023
- Cut-off time for UPI mandate confirmation: 5 PM on October 5, 2023

Lot Size Landscape:

Investors had the flexibility to bid for a minimum of 277 shares and in multiples thereof. The table below outlines the investment parameters for retail investors and HNIs:

Application	Lots	Shares	Amount
Retail (Min)	1	277	₹14,958
Retail (Max)	13	3601	₹194,454
S-HNI (Min)	14	3,878	₹209,412
S-HNI (Max)	66	18,282	₹987,228
B-HNI (Min)	67	18,559	₹1,002,186

Promoter Holdings Shift:

Mr. Sanjay Gupta and Mrs. Sonia Gupta, the company's promoters, witnessed a shift in pre-issue promoter holding from 100% to 69.83% post the IPO.

Company Profile:

Incorporated in 2006, Plaza Wires Limited specializes in manufacturing and selling wires, LT aluminium cables, and fast-moving electrical goods (FMEG). Renowned for its flagship brand "PLAZA CABLES" and home brands like "Action Wires" and "PCG," the company offers a range of products including house wires, flexible industrial cables, and cables for submersible pumps. Plaza Wires has also expanded its product portfolio to include miniature circuit breakers and distribution boards.
As of March 31, 2023, the company has a robust network, comprising over 1249 authorized dealers and distributors, 3 branch offices, 4 warehouses, and a C&F agent.

Financial Performance Overview:

As of March 31, 2023, Plaza Wires reported total assets of ₹112.10 crores, revenue of ₹182.60 crores, and a net profit of ₹7.51 crores. Key financial indicators include a market cap of ₹236.26 crores, P/E (x) at 21.95, ROE of 14.15%, ROCE of 15.57%, debt/equity at 0.75, EPS of ₹2.46, and RoNW of 14.16%.

Objects of the Issue:

The net proceeds from the issue are intended for funding the capital expenditure towards setting up a new manufacturing unit for house wires, fire-resistant wires & cables, aluminum cables, and solar cables to expand the product portfolio, funding the working capital requirements of the company, and general corporate purposes.

IPO Review:

Suggests that Plaza Wires, operating in a competitive segment, has shown steady growth in its top and bottom lines. The issue appears fully priced based on FY23 earnings, making it suitable for investors looking for medium to long-term rewards.

IPO Subscription Status:

The Plaza Wires IPO witnessed an overwhelming response, being subscribed 160.97 times on October 5, 2023. The public issue was subscribed 374.81 times in the retail category, 42.84 times in the QIB category, and 388.09 times in the NII category. *Note: All financial fi

Note: All financial figures are in INR (Indian Rupees), and market-related data is as of December 15, 2023.

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