The RR Kabel IPO subscription period commenced on Wednesday, September 13, and will conclude on Friday, September 15, 2023. Key details and expectations for this IPO include:
1) Price Band: RR Kabel has set the price band for its IPO in the range of ₹983 to ₹1,035 per equity share with a face value of ₹5 each.
2) Anchor Investment: On September 12, the company successfully raised ₹585 crore from anchor investors, setting a positive tone for the public issue.
3) Allocation: The IPO allocation is structured as follows: not more than 50% of shares are reserved for Qualified Institutional Buyers (QIBs), not less than 15% for Non-Institutional Investors (NIIs), and a minimum of 35% of the offer is allocated to Retail Investors. Additionally, ₹10.8 crore worth of shares have been reserved for employees, offered at a discount of ₹98 per share compared to the final offer price.
4) Company Profile: RR Kabel is a prominent player in the fast-moving electrical goods (FMEG) and wires and cables sectors within the consumer electrical industry, boasting over two decades of history in India.
5) Industry Peers: The company is listed alongside industry peers such as Havells India Ltd, Polycab India Ltd, KEI Industries Ltd, Finolex Cables Ltd, V-Guard Industries Ltd, Crompton Greaves Consumer Electricals Ltd, and Bajaj Electricals Ltd.
6) Growth: RR Kabel has exhibited robust growth, with a Compound Annual Growth Rate (CAGR) of 43.4% between Fiscal 2021 and Fiscal 2023, making it one of the fastest-growing consumer electrical companies in India.
7) IPO Metrics: The IPO’s floor price is 196.60 times the face value, while the cap price is 207.00 times the face value of the equity shares.
8) Utilization of Funds: Of the total funds raised, ₹136 crore will be directed towards debt reduction. The company envisions reaching a revenue of ₹7,000 crore from its existing capacity and achieving a breakeven point at an FMEG revenue of ₹1,200 crore.
9) RR Kabel IPO Review: Canara Bank Securities Ltd recommends subscribing to RR Kabel IPO for the long term, citing its position as the fifth-largest player in the Indian wires and cables business, significant revenue growth in wires and cables, and fairly priced based on FY2023 earnings per share (EPS).
10) Allotment and Listing Date: The basis of allotment for RR Kabel IPO shares will be finalized on September 21, with refunds initiated on September 22. Shares will be credited to allottees’ demat accounts on September 25. The expected listing date for RR Kabel IPO shares on BSE and NSE is September 26, 2023.
11) Grey Market Premium (GMP): As of the latest information, the grey market premium (GMP) for RR Kabel IPO stands at +150, indicating a premium of ₹150 over the issue price. Based on this premium, the estimated listing price for RR Kabel IPO shares is ₹1,185, representing a 14.49% increase from the IPO price of ₹1,035.
Please note that ‘grey market premium’ reflects investors’ willingness to pay above the issue price and should be considered with caution.
Investors are advised to conduct thorough research and consult with financial experts before making investment decisions.
[Disclaimer: The views and recommendations mentioned are those of individual analysts or brokerage firms and should be verified with certified experts before taking any investment actions.]
