Cables IPOs in India offer investment opportunities in a critical infrastructure sector. These IPOs cater to rising demand from power, telecom, and construction industries, fueled by infrastructure growth and government initiatives, making them an attractive option for long-term investors.
Content:
- Overview of Cables IPOs in India
- IPO Fundamental Analysis
- IPO Financial Analysis
- About the Company
- Advantages of Investing in Cables Sector IPOs
- Disadvantages of Investing in Cables Sector IPOs
- Role of Cables Industry in the Economy
- How to invest in Cables IPOs?
- Future Outlook of Cables IPOs in India
- Cables IPOs in India – FAQ
Overview of Cables IPOs in India
The Indian cables industry plays a vital role in infrastructure development, driven by increasing demand for power transmission, telecommunications, and renewable energy projects. Companies raising capital through IPOs aim to expand production capacity and modernize operations, providing potential for strong growth and returns.
Cables IPOs reflect the sector’s resilience and importance to India’s economic growth. Investors are drawn to these offerings due to robust demand, favorable policies, and a growing focus on sustainability, which enhances long-term prospects for companies in this space.
IPO Fundamental Analysis
R R Kabel Ltd
R R Kabel Ltd has shown strong growth in recent years, with consistent increases in revenue, equity, and assets. Despite some fluctuations in profitability and EPS, the company remains on a stable financial footing, driven by strategic expansion and market demand.
Revenue Trend
R R Kabel Ltd showed consistent growth in sales, increasing from ₹4,386 Crores in FY22 to ₹5,599 Crores in FY23, and further rising to ₹6,595 Crores in FY24. This indicates strong operational performance and improving market demand in its key sectors.
Equity and Liabilities
The company’s equity capital grew steadily, reaching ₹56.41 Crores in FY24, up from ₹47.85 Crores in FY23 and ₹23.92 Crores in FY22. Total liabilities also increased, amounting to ₹2,869 Crores in FY24, up from ₹2,634 Crores in FY23, reflecting the company’s expansion strategy.
Profitability
R R Kabel’s operating profit margin (OPM) slightly improved to 6.94% in FY24 from 5.72% in FY23, though it was slightly lower than the 6.84% achieved in FY22. This indicates efficient cost management and profitability stability despite market pressures.
Earnings per Share (EPS)
EPS increased significantly to ₹26.43 in FY24, compared to ₹19.84 in FY23 and ₹89.42 in FY22. While the EPS has improved, a significant drop in FY22 suggests a recovery in financial health following earlier challenges.
Return on Net Worth (RoNW)
RoNW for R R Kabel Ltd slightly decreased to 16.28% in FY24 from 18.86% in FY23 but remains solid. This indicates a healthy return on equity, reflecting the company’s strong market position and effective capital utilization over the past few years.
Financial Position
R R Kabel’s total assets rose to ₹2,869 Crores in FY24 from ₹2,634 Crores in FY23, driven by increasing sales and equity growth. Current assets remained steady at ₹1,995 Crores in FY24, reflecting stable liquidity and financial management in line with overall growth.
Plaza Wires Ltd
Plaza Wires Ltd is a leading manufacturer experiencing steady growth, with increased sales and investments reflecting strong market demand and investor confidence in its operational and financial strategies.
Revenue Trend
Plaza Wires Ltd experienced steady growth in sales, increasing from ₹176.77 Crores in FY22 to ₹182.49 Crores in FY23, and further rising to ₹198.81 Crores in FY24. This consistent growth reflects positive market demand and operational improvements over the years.
Equity and Liabilities
Equity capital grew significantly to ₹43.75 Crores in FY24, up from ₹30.55 Crores in both FY22 and FY23, reflecting an increase in investor confidence. Total liabilities rose to ₹172.77 Crores in FY24, compared to ₹112.1 Crores in FY23, indicating higher borrowing to fund expansion.
Profitability
Plaza Wires’ operating profit margin (OPM) declined to 4.96% in FY24 from 8.6% in FY23, and 7.45% in FY22. Despite the decrease, the company continues to manage profitability, although facing some margin pressure from higher costs and increased liabilities.
Earnings per Share (EPS)
EPS decreased to ₹0.84 in FY24, down from ₹2.46 in FY23 and ₹1.95 in FY22, suggesting reduced profitability. While the decline is concerning, it still reflects positive earnings compared to the company’s earlier years of growth.
Return on Net Worth (RoNW)
RoNW slightly improved to 14.15% in FY23, up from 13.08% in FY22, indicating a positive return on equity despite fluctuating earnings. This improvement demonstrates the company’s ability to generate shareholder value amidst ongoing challenges.
Financial Position
Plaza Wires’ current assets grew significantly to ₹143.07 Crores in FY24 from ₹85.38 Crores in FY23, reflecting improved liquidity. Total assets increased to ₹172.77 Crores in FY24, in line with the rise in liabilities, indicating balanced asset growth to support ongoing operations.
Polycab India Ltd
Polycab India Ltd has demonstrated impressive growth with consistent increases in revenue, profitability, and equity over the past few years. The company’s strong market presence, efficient cost management, and strategic expansion have driven its continued success and solid financial performance.
Revenue Trend
Polycab India Ltd showed strong growth in sales, increasing from ₹12,204 Crores in FY22 to ₹14,108 Crores in FY23, and further rising to ₹18,039 Crores in FY24. This consistent revenue growth reflects the company’s strong market presence and demand for its products.
Equity and Liabilities
Equity capital remained stable, rising slightly to ₹150.24 Crores in FY24 from ₹149.77 Crores in FY23 and ₹149.44 Crores in FY22. Total liabilities increased to ₹12,079 Crores in FY24, compared to ₹9,425 Crores in FY23, reflecting the company’s expanding operations and higher working capital requirements.
Profitability
Polycab’s operating profit margin (OPM) improved to 13.65% in FY24, up from 13.01% in FY23 and 10.29% in FY22. This positive trend highlights the company’s efficient cost management and ability to generate higher profits from its growing sales.
Earnings per Share (EPS)
EPS grew significantly to ₹118.75 in FY24, up from ₹84.8 in FY23 and ₹60.8 in FY22, reflecting robust profitability. The consistent rise in EPS over the past three years showcases Polycab’s effective business strategies and earnings growth.
Return on Net Worth (RoNW)
RoNW improved to 21.73% in FY24, from 19.24% in FY23 and 16.87% in FY22, indicating strong returns on equity. This steady increase in RoNW reflects effective capital utilization and sustained profitability in a growing market.
Financial Position
Polycab’s current liabilities increased to ₹3,578 Crores in FY24 from ₹2,627 Crores in FY23, while current assets grew to ₹8,714 Crores in FY24 from ₹6,909 Crores in FY23, reflecting a healthy liquidity position. Total assets also rose to ₹12,079 Crores in FY24, supporting the company’s continued growth.
IPO Financial Analysis
R R Kabel Ltd
| FY 24 | FY 23 | FY 22 | |
| Sales | 6,595 | 5,599 | 4,386 |
| Expenses | 6,133 | 5,277 | 4,083 |
| Operating Profit | 461.7 | 322.32 | 303.25 |
| OPM % | 6.94 | 5.72 | 6.84 |
| Other Income | 62.61 | 34.44 | 46.28 |
| EBITDA | 524.32 | 356.76 | 349.53 |
| Interest | 53.85 | 42.09 | 23.28 |
| Depreciation | 65.49 | 59.63 | 46.08 |
| Profit Before Tax | 404.98 | 255.05 | 280.16 |
| Tax % | 26.66 | 25.92 | 25.14 |
| Net Profit | 298.13 | 189.87 | 213.94 |
| EPS | 26.43 | 19.84 | 89.42 |
| Dividend Payout % | 22.7 | 22.68 | 0 |
All values in ₹ Cr.
Plaza Wires Ltd
| FY 24 | FY 23 | FY 22 | |
| Sales | 198.81 | 182.49 | 176.77 |
| Expenses | 188.89 | 166.79 | 163.59 |
| Operating Profit | 9.91 | 15.7 | 13.19 |
| OPM % | 4.96 | 8.6 | 7.45 |
| Other Income | 1.1 | 0.1 | 0.16 |
| EBITDA | 11.01 | 15.8 | 13.35 |
| Interest | 4.33 | 4.22 | 3.43 |
| Depreciation | 1.46 | 1.25 | 1.29 |
| Profit Before Tax | 5.22 | 10.33 | 8.64 |
| Tax % | 29.59 | 27.32 | 31.05 |
| Net Profit | 3.68 | 7.51 | 5.95 |
| EPS | 0.84 | 2.46 | 1.95 |
All values in ₹ Cr.
Polycab India Ltd
| FY 24 | FY 23 | FY 22 | |
| Sales | 18,039 | 14,108 | 12,204 |
| Expenses | 15,548 | 12,256 | 10,939 |
| Operating Profit | 2,492 | 1,852 | 1,265 |
| OPM % | 13.65 | 13.01 | 10.29 |
| Other Income | 220.88 | 133.33 | 89.92 |
| EBITDA | 2,713 | 1,985 | 1,355 |
| Interest | 108.34 | 59.76 | 35.19 |
| Depreciation | 245.04 | 209.16 | 201.52 |
| Profit Before Tax | 2,359 | 1,717 | 1,118 |
| Tax % | 23.58 | 24.76 | 24.2 |
| Net Profit | 1,803 | 1,282 | 917.28 |
| EPS | 118.75 | 84.8 | 60.8 |
| Dividend Payout % | 25.26 | 23.58 | 23.03 |
All values in ₹ Cr.
About the Company
R R Kabel Ltd
R R Kabel Ltd is a prominent player in the Indian electrical and wires market, specializing in manufacturing high-quality cables and wires. The company serves a diverse range of industries, including residential, commercial, and industrial sectors, with a strong focus on innovation and customer satisfaction.
With a robust manufacturing infrastructure and a wide distribution network, R R Kabel ensures product reliability and safety. The company’s portfolio includes cables, electrical products, and advanced solutions catering to both domestic and international markets. R R Kabel’s commitment to sustainability and quality sets it apart in the competitive electrical market.
Plaza Wires Ltd
Plaza Wires Ltd is a leading manufacturer of wires and cables in India, offering a wide array of products that cater to electrical, industrial, and telecommunication sectors. The company is known for its focus on quality and customer-centric solutions in the competitive market.
Plaza Wires boasts advanced manufacturing facilities and a commitment to adopting the latest technology to deliver top-notch products. It emphasizes safety and durability in its cables, which are trusted by industries like power, telecom, and construction. Plaza Wires is dedicated to expanding its market reach and maintaining long-term business relationships.
Polycab India Ltd
Polycab India Ltd is one of India’s largest manufacturers of wires and cables, known for its premium quality products and extensive market presence. The company provides electrical solutions for residential, commercial, and industrial applications, excelling in both innovation and customer service.
Polycab’s diverse product range includes power cables, communication cables, and accessories, all designed to meet global standards. With a strong distribution network, Polycab has established a leading position in the Indian market and is expanding its reach internationally. The company is committed to sustainability and continuous technological advancements in the electrical sector.
Advantages of Investing in Cables Sector IPOs
The main advantages of investing in cables sector IPOs include high growth potential, rising infrastructure demand, government initiatives, and diversification opportunities. These factors make the sector attractive for investors seeking steady growth and long-term returns.
- Infrastructure Demand: Growing investments in infrastructure, renewable energy, and smart cities increase the need for cables, offering strong growth opportunities for companies in this sector.
- Government Support: Policies promoting electrification and sustainable energy projects bolster the cables industry, enhancing its long-term stability and attractiveness for investors.
- Export Potential: Indian cable companies are expanding globally, offering exposure to international markets and additional revenue streams for investors.
- Sector Resilience: The cables industry is less affected by economic cycles due to its critical role in infrastructure projects, ensuring consistent demand and stability.
Disadvantages of Investing in Cables Sector IPOs
The main disadvantages of investing in cables sector IPOs include dependency on raw material prices, competition, regulatory challenges, and exposure to infrastructure project delays. These risks require careful consideration before investing.
- Raw Material Volatility: Cable production depends on metals like copper and aluminum, which are subject to price fluctuations, impacting profitability.
- Competition: Intense competition within the sector can lead to pricing pressures, affecting profit margins and market share.
- Regulatory Challenges: Stringent government regulations and delays in approvals for large-scale projects can impact the growth trajectory of cable companies.
- Project Delays: Infrastructure project slowdowns or cancellations can reduce demand, negatively affecting revenue and growth for cable manufacturers.
Role of Cables Industry in the Economy
The cables industry is integral to India’s infrastructure development, providing essential components for power, telecommunications, and transportation projects. It supports renewable energy growth and urbanization, contributing to economic progress and employment generation.
Moreover, the industry drives technological advancements, ensuring efficient energy transmission and connectivity. It supports sectors like real estate, manufacturing, and logistics, boosting overall industrial productivity and enhancing India’s global competitiveness in infrastructure and technology.
How to invest in Cables IPOs?
To invest in Cables IPOs, open a demat and trading account with Alice Blue. Stay informed on upcoming IPOs in the cable sector and apply using the ASBA facility through Alice Blue.
- Research the Company: Study the company’s financials, business model, and market position to evaluate potential returns and risks.
- Review IPO Prospectus: Analyze the prospectus for details on valuation, use of proceeds, and risk factors.
- Open a Demat Account: Use a platform like Alice Blue to open a Demat account and enable seamless IPO applications.
- Apply Through ASBA/UPI: Submit your application using ASBA or UPI via your bank or trading platform during the IPO subscription period.
- Check Allotment Status: Track your allotment status and plan your investment strategy post-listing based on market conditions.
Future Outlook of Cables IPOs in India
The future of cables IPOs in India appears promising, driven by increasing investments in renewable energy, smart grids, and infrastructure development. The sector is expected to grow significantly, supported by government initiatives and private sector participation.
As urbanization and industrialization expand, the cables industry will benefit from rising demand for advanced products like fiber optics and sustainable solutions. This creates long-term opportunities for investors in well-positioned companies within the sector.
Cables IPOs in India – FAQ
A Cables IPO is the process where cable manufacturing companies issue their shares to the public for the first time to raise capital, enabling growth and expansion within the sector.
Major cables companies in India that have launched IPOs include Polycab India, KEI Industries, and RR Kabel, which have gained significant market attention due to their strong growth prospects.
Cables IPOs provide investors with opportunities in a growing sector, offering exposure to companies capitalizing on infrastructure development, electricity, and telecommunications, critical drivers of India’s economic growth.
The largest Cables IPO in India was Polycab India Ltd’s IPO in 2019, raising ₹1,345 crores. The company has seen steady growth since its listing, strengthening its market presence.
To invest in Cables IPOs, open a Demat and Trading account with a registered broker, such as Alice Blue. Then, apply for the IPO through the broker or online trading platform.
Cables IPOs can be suitable for long-term investment, especially if the company shows strong growth, stability, and market leadership. However, due diligence is essential before committing funds for the long term.
Cables IPOs can be profitable, especially if the companies show consistent growth in revenue and market share. However, stock prices may fluctuate, and past performance doesn’t guarantee future results.
To find upcoming Cables IPOs in India, check financial news platforms, IPO calendars, or consult with brokers like Alice Blue to stay updated on new investment opportunities in this sector.
Detailed reviews and analysis of Cables IPOs can be found on financial news websites, brokerage platforms like Alice Blue, and investment research platforms that offer comprehensive IPO analysis and ratings.
Disclaimer: The above article is written for educational purposes, and the companies’ data mentioned in the article may change with respect to time The securities quoted are exemplary and are not recommendatory.
