Plaza Wires Limited IPO - Review, Date, Valuation & GMP

Plaza Wires Limited - Complete Overview

Established in 2006, Plaza Wires Limited engages in the business of manufacturing and sale of wires, as well as marketing LT aluminium cables and Fast-Moving Electrical Goods (FMEG) under its flagship brand "PLAZA CABLES," along with house brands like "Action Wires" and "PCG."

Originally founded as Navratna Wires, the company's product range includes various types of wires, cables, and FMEG, such as electric fans, water heaters, switches, switchgears, PVC insulated electrical tape, and PVC conduit pipes & accessories.

In the wires and cables segment, the company's primary products consist of building wires (commonly known as house wires), single and multicore round flexible industrial cables, and industrial cables designed for submersible pumps and motors up to 1.1kV grade.

Additionally, the company offers LT power control cables, TV dish antenna co-axial cables, telephone and switchboard industrial cables, computer and LAN networking cables, closed-circuit television cables, and solar cables, as well as PVC insulated tape and PVC conduit pipe & accessories.

Starting in 2016, Plaza Wires entered into agreements with third-party manufacturers and introduced FMEG products, including electric fans and water heaters. To provide after-sales service for electric fans, the company has established partnerships with more than 20 service centres across several states, including Uttar Pradesh, Uttarakhand, Jammu and Kashmir, Punjab, Haryana, and Tamil Nadu. In 2021, the company expanded its product portfolio by introducing miniature circuit breakers and distribution boards (DB) in the northern and southern regions of India.

Plaza Wires has built a robust distribution network, with over 1,249 authorized dealers and distributors nationwide. They operate from three branch offices located in Rajasthan, Uttarakhand, and Uttar Pradesh, in addition to one branch office with a warehouse in Maharashtra. The company also maintains four warehouses in Uttar Pradesh, Assam, Kerala, and Delhi and collaborates with a C & F agent in one state, Punjab.

 

 

What does the company do? 

Plaza Wires Limited engages in the business of manufacturing and sale of wires, as well as marketing LT aluminium cables and Fast-Moving Electrical Goods (FMEG) under its flagship brand "PLAZA CABLES," along with house brands like "Action Wires" and "PCG."

 

Company Products 

Plaza Cables, Action Cables, Plaza Fan, Immersion Heater & Iron, and PCG Products.

 

IPO Overview

The Plaza Wires Limited IPO date is planned to be open for subscription from September 29, 2023, to October 4, 2023, with an expected listing date of October 12, 2023.

The Plaza Wires Limited's IPO price is established at Rs. 51 to Rs. 54 per share, and the total issue size for the upcoming IPO amounts to Rs. 71.28 Crores.

Regarding allocation, the company has earmarked 75% for institutional investors, 15% for non-institutional investors, and 10% for retail investors.

 

Plaza Wires Limited IPO timetable (Tentative)

Events	Date
IPO Opening Date	29 September 2023
IPO Closing Date	4 October 2023
IPO Allotment Date	9 October 2023
Refund initiation	10 October 2023
IPO Listing Date	12 October 2023

 

 Plaza Wires Limited IPO Details 

IPO Opening & Closing Date	29 September to 4 October 2023
Face value	Rs.10 per share
Issue Price	Rs. 51 to Rs. 54 per share
Lot Size	277 Shares
Price of 1 lot	Rs. 14,958
Issue Size	13,200,158 Shares (aggregating up to Rs. 71.28 Cr)
Offer for sale	NA
Fresh issue	13,200,158 Shares (aggregating up to Rs. 71.28 Cr)
Listing at	BSE, NSE
Issue Type	Book Built Issue IPO
Registrar	Kfin Technologies Limited

 

Plaza Wires Limited IPO Lot Details 

Minimum Lot Investment (Retail)	1 lot
Maximum Lot Investment (Retail)	13 lot
Minimum Lot Investment (HNI)	14 lot
Maximum Lot Investment (HNI)	67 lot

 

Plaza Wires Limited IPO Reservation

Institutional share Portion	75%
Non-institutional share Portion	15%
Retail share Portion	10%

 

Company Financial

Amount in Crores

Period	FY 21	FY 22	FY 23
Total Assets	99.28	104.17	112.10
Total Revenue	145.60	176.94	182.60
PAT	4.24	5.95	7.51
Net worth	39.48	45.52	53.08
Reserve & Surplus	35.66	14.96	22.53
Total Borrowings	43.30	40.09	39.68

 

Breakdown of the total income for the various products of the company

(Amount in Million)

Products	FY 23	FY 22	FY 21
Wires and cables
Aluminiumcable	168.96	127.71	89.57
Copper wire &cable	1547.08	1531.31	1223.27
Total	1716.04	1659.02	1312.84
FMEG Products
Fans and Appliances	23.71	30.05	55.70
MCBs and isolators	6.42	7.22	0.28
Total	29.13	37.27	55.98
PVC pipe	43.58	44.55	48.85
Tape	14.36	11.49	9.00
Others	21.81	45.59	73.76
Total	79.75	101.63	131.61

 

Geography-wise sales of the products

(Amount in Million)

Geographic Region	FY 21	FY 22	FY 23
Delhi	463.70	544.87	537.18
Uttar Pradesh	458.28	513.58	567.69
Haryana	101.36	127.47	123.05
Kerala	122.15	116.76	86.18
Uttarakhand	59.22	71.83	71.73
Total	1204.71	1374.51	1385.83

 

Objective of the Issue

The company intends to allocate the Net Proceeds for the following purposes:

• Financing the capital expenditure for the establishment of a new manufacturing facility, aimed at diversifying the product portfolio with the production of house wires, fire-resistant wires & cables, aluminium cables, and solar cables (referred to as the "Project").
• Covering the working capital needs of the company.
• Addressing general corporate requirements.

 

Promoters and Management of Plaza Wires Limited

Mr. Sanjay Gupta and Mrs. Sonia Gupta are the promoters of the company.

Pre-issue Promoter Shareholding	100.00%
Post-issue Promoter Shareholding	69.83%

 

Peer Comparison 

Below are the listed peers of Plaza Wires Limited

Company Name	EPS (Diluted)	P/E Ratio	Total Income (In million)
Plaza Wires Limited	2.46	-	1,825.95
Cords Cable Industries Ltd.	5.52	16.65	5,276.47
Ultracab (India) Ltd	0.61	24.18	1,076.72
V-Marc India Limited	4.58	25.55	2,498.50
Dynamic Cables Limited	14.09	32.22	6,717.48
Paramount Communications Limited	2.40	23.75	8,127.20

 

IPO's Valuations

To assess the IPO valuation of Plaza Wires Limited, we can utilize the information presented in the DRHP. The Plaza Wires Limited IPO price is set within the range of Rs. 51 to Rs. 54 per share, and the EPS is reported at Rs. 2.46. At the higher end of the issue price, the PE ratio for the company stands at 21.95.

 

Dividend Policy 

According to the Plaza Wires Limited IPO DRHP, the company has not distributed any dividends in the past. Nevertheless, the potential for future dividend payments is contingent upon the company's financial performance.

 

IPO's Strengths 

• Diverse product portfolio catering to different customer segments and markets.
• Strong and extensive distribution network.
• Experienced management team and a committed workforce.

 

IPO Weaknesses 

• One of the Group Companies, namely Plaza Cable Electric Private Limited, is involved in activities similar to those of the company.
• A significant portion of the company's sales is generated from specific geographical regions.
• In the industry segments where the company operates, which are fragmented, it faces competition from larger players.
• The company primarily relies on the sale of its Wires and Cables products.
• The company is subject to stringent quality requirements, and any product defects could pose issues.
• For the production of certain products, the company depends on third-party manufacturers.
• The Company, its Promoters, its Directors, and one of its Group Companies are parties to various legal proceedings.

 

 

IPO GMP Today

The Latest GMP of Plaza Wires IPO is Rs. 17.

 

Conclusion

Plaza Wires Limited operates within a highly competitive market. The company has demonstrated sustained growth over the years and has established an extensive distribution network. Furthermore, the company's expansion initiatives point toward a promising future. It is advisable for investors to allocate their funds to this offering after conducting a thorough analysis.
 

 

Finowings IPO Analysis

Hope you enjoyed the Finowings IPO Analysis. We tried our best to give every required detail about the company that you should know before applying to the IPO. 

You must consult your financial advisor before making any financial decisions. 

To Apply for the IPO, Click Here.

 

To Read the Prospectus of the Company Click Here to Download the DRHP.

 

 

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