RR Kabel Fixes Price Bands For Rs 1,964 Crore IPO; Check GMP, Allotment, Offer Details Here

One of the leading companies in the Indian consumer electrical industry, RR Kabel has fixed the price band of Rs 983 per share to Rs 1,035 per share ahead of its approximately Rs 1,964 crore worth of initial public offering (IPO). The TPG-backed firm will be launching its IPO from September 13 to September 15. The proposed equity shares in the issue will be listed on BSE and NSE.

The company will launch its IPO from September 13 to 15, comprising of fresh issue worth Rs 180 crore and an offer for sale (OFS) of up to Rs 1,72,36,808 shares. The company is looking to raise Rs 1,964 crore from the IPO.

Under the OFS, the selling shareholders are -- Mahendrakumar Rameshwarlal Kabra, Hemant Mahendrakumar Kabra, Sumeet Mahendrakumar Kabra, Kabel Buildcon Solutions, Ram Ratna Wires, and TPG Asia VII SF.

Of the total issue size, 50% will be reserved for qualified institutional buyers (QIBs), while 15% to be kept for non-institutional investors (NIIs), and the rest of 35% for retail individual investors (RIIs). The company is offering shares worth Rs 10.8 crore to its eligible employees as well.

The price band of Rs 983 to Rs 1,035 per equity share is 196.60 times and 207 times the face value of the equity shares. The price-to-earnings ratio based on diluted EPS for FY23 for the company at the higher end of the price band is as high as 60.63 times and at the lower price band, it is 57.59 times.

Under the employees' reservation portion, RR Kabel will also be offering a discount of Rs 98 per equity share to its eligible employees who will be bidding in the IPO.

For the IPO, bids can be made for a minimum of 14 equity shares and in multiples of 14 equity shares thereafter.

Book-running lead managers for the IPO are Axis Capital, HSBC Securities Markets (India), Citigroup Global Markets, and JM Financial. Further, Link Intime India is the registrar of the issue.

The company plans to use the proceeds from fresh issues for repayment of borrowings availed from m banks and financial institutions. Also, a part of the proceeds will be used for general corporate purposes.

According to Chittorgarh's report, after the IPO, the basis of allotment of equity shares is likely to be held on September 21, followed by initiation of refunds on September 22, and credit of shares in demat accounts on September 25. Accordingly, the listing is expected on September 27.

On Friday, the grey market premium (GMP) of RR Kabel was at Rs 40 per share. As per TopShareBrokers, with the price band of 1035.00, R R Kabel IPO's estimated listing price is ₹1075 (cap price + today's GMP). The expected percentage gain/loss per share is 3.86%.

RR Kabel is one of the leading companies in the Indian consumer electrical industry (comprising wires and cables and fast-moving
electrical goods ("FMEG")), with an operating history of over 20 years in India. The company is the fastest growing consumer electrical company among our peers in India, growing at a CAGR of 33.0% between Fiscal 2020 and Fiscal 2022.

Also, the company is the e fifth largest player in the wires and cables market in India, representing approximately 5% market share by value as of March 31, 2022.

As of December 31, 2022, the company's revenue from operations stood at Rs 408.27 crore, while profit for the period stood at Rs 12.5 crore. In FY22, the company's revenue and PAT were at Rs 438.59 crore and Rs 21.39 crore respectively.