Plaza Wires subscribed 50x on Day 3 so far; retail portion booked about 196 times

The initial public offering (IPO) of Plaza Wires continued to see a stellar response from the investors during the third day of the bidding process, particularly by retail and non-institutional investors (NIIs).

The New Delhi-based Plaza Wires is selling its shares in the price band of Rs 51-54 apiece with a lot size of 277 shares and its multiples thereafter to raise a total of Rs 71.28 crore. The entire block is sale of fresh 13,200,158 crore equity shares. The bidding will continue for four days.

According to the data, the investors made bids for 47,44,17,069 equity shares, or 49.96 times, compared to the 94,96,114 equity shares offered for the subscription by 3.35 pm on Wednesday, October 04. The bidding, which had opened on Friday, September 24, will conclude on Thursday, October 5.

The allocation for retail investors was subscribed a whopping 195.48 times, while the portion reserved for non-institutional investors saw a subscription of 102.12 times. However, the quota set aside for qualified institutional bidders (QIBs) was subscribed 2.29 times as of the same time.

Incorporated in 2006, Plaza Wires manufactures and sells wires and cables as the company sells and markets LT aluminium cables and fast-moving electrical goods (FMEG) and home brands. It has a network of more than 1,249 authorised dealers and distributors.

It has three branch offices each in Rajasthan, Uttarakhand, and Uttar Pradesh; one branch office in Maharashtra, four warehouses in Uttar Pradesh, Assam, Kerala and Delhi. The company clocked a net profit of Rs 7.51 crore with a revenue of Rs 182.60 crore in the financial year 2022-23.

Asit C Mehta Investment Intermediates has suggested subscribing to the issue citing  its product portfolio focused on various customer segments and markets; distribution network and experienced management and dedicated employee base.

"The issue is valued at a P/E of 22 times based on FY2023 earnings which prices in most of the positives of the company. It is important to note that Plaza Wires operates in an industry which has high raw material volatility. The business operates in a highly competitive industry with multiple big players which can challenge the pricing power," said StoxBox with an 'avoid' rating.


Disclaimer: Business Today provides stock market news for informational purposes only and should not be construed as investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.

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