TGP Capital-backed wires and cables manufacturer RR Kabel Ltd kicks off for subscription today as the company will sell its shares in a fixed price band of Rs 983-1035 apiece with a lot size of 14 equity shares and its multiples thereof. The three-day bidding will conclude on Friday.
Incorporated in 1995, RR Kabel provides consumer electrical products used for residential, commercial, industrial, and infrastructure purposes in two major segments, namely wires and cables including house wires, industrial wires, power cables, and special cables; and FMEG including fans, lighting, switches, and appliances.
As per the RHP the listed industry peers of the company are Havells India Ltd, Polycab India Ltd, KEI Industries Ltd, Finolex Cables Ltd, V-Guard Industries Ltd, Crompton Greaves Consumer Electricals Ltd, Bajaj Electricals Ltd.
RR Kabel IPO price band: RR Kabel price band has been fixed in the range between Rs 983 to Rs 1,035 per equity share of face value of Rs 5 each.
RR Kabel IPO lot size: RR Kabel lot size is 14 equity shares and in multiples of 14 equity shares thereafter.
RR Kabel IPO Anchor Investors: The allocation to anchor investors for RR Kabel IPO is scheduled to take place on today (Tuesday, September 12).
RR Kabel IPO details: At the upper end of the price band, RR Kabel IPO aims to raise Rs 1,964.01 crore from the IPO. The IPO comprises fresh issue of equity shares worth Rs 180 crore and an offer for sale (OFS) of 1.72 crore equity shares worth Rs 1,784 crore by the promoters and investors. In the OFS, TPG Asia VII SF Pte Ltd will offload 1.29 crore equity shares, while public shareholder Ram Ratna Wires will sell its entire shareholding of 13.64 lakh shares.
Other selling shareholders in the OFS include promoters Mahendrakumar Kabra, Hemant Kabra, Sumeet Kabra and Kabel Buildcon Solutions, a part of the promoter group.
RR Kabel IPO objectives: The company plans to utilise the fresh issue proceeds mainly for repaying debt amounting to Rs 136 crore, and for general corporate purposes.
RR Kabel IPO allotment date and RR Kabel listing date: RR Kabel IPO basis of allotment of shares will be finalised on Thursday, September 21 and the company will initiate refunds on Friday, September 22, while the shares will be credited to the demat account of allottees on Monday, September 25. RR Kabel IPO shares are likely to be listed on BSE and NSE on Tuesday, September 26.
Axis Capital Ltd, Citigroup Global Markets India Private Ltd, HSBC Securities and Capital Markets (India) Private Ltd, JM Financial Ltd are the book running lead managers (BRLM) for the offer. Link Intime India Private Ltd is the offer’s registrar.
RR Kabel IPO reservation: RR Kabel IPO has reserved not more than 50% of the shares in the public issue for Qualified Institutional Buyers (QIB), not less than 15% for Non Institutional Investors (NII), and not less than 35% of the offer is reserved for Retail Investors.
RR Kabel IPO GMP today: RR Kabel IPO GMP today or grey market premium is +218 similar to the previous trading session. This indicates RR Kabel IPO share price were trading at a premium of Rs 218 in the grey market on Tuesday, according to topsharebrokers.com
Considering the upper end of the IPO price band and the current premium in the grey market, the estimated listing price of RR Kabel IPO share price is Rs 1,253 apiece, which is 21.06% higher than the IPO price of Rs 1,035.
‘Grey market premium’ indicates investors’ readiness to pay more than the issue price.
RR Kabel IPO: Should You Invest?
The structural growth drivers for consumer electrical business continues may remain strong. RR Kabel has a diverse suite of products; it has scaled the business in B2C in W&C, expanding the FMEG segment using its extensive global and domestic network, said Reliance Securities.
“We believe the premiumisation path could potentially result in structural margin expansion and B2C sales are likely to remain strong in coming years; the recent correction in input prices and the strong surge in multiple demand drivers augurs well for the company,” it added with a ‘subscribe’ rating for the issue.
With solid brand recognition, diversified product profile, scale of operations, certified manufacturing facilities and wide & largest distribution network, RKL is well positioned to capture the growth in the domestic consumer electrical market, said Choice Broking, which has a ‘subscribe with caution’ rating for the issue.
“Profitability margins and return ratios are likely to improve going forward mainly in the anticipation of lower raw material prices and improved business dynamics. At a higher price band, RKL is demanding a TTM P/E multiple of 47.4 times, which is at discount to the peer average. However, the issue seems to be fully priced considering its subdued profitability and return ratios,” it added.
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