Prime Cable Industries Makes Stock Market Debut with Modest 4% Grey Market Premium
Prime Cable Industries, a cable and wire manufacturer, has entered the stock market with a modest 4% grey market premium despite strong IPO subscription rates. The Rs 40 crore IPO was oversubscribed 8.28 times across investor categories. The company, operating under brands Primecab and Renufo, reported a 71% revenue increase to Rs 141.10 crore and a 319% profit surge to Rs 7.50 crore. IPO proceeds will fund capital expenditure, loan repayment, and working capital. Post-IPO, promoter holding will decrease from 92.9% to 68.2%, with the stock trading at a P/E ratio of 20.3 times at the upper price band.
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Prime Cable Industries, a prominent cable and wire manufacturer, has made its debut on the stock market with a muted grey market premium, despite a strong response to its initial public offering (IPO). The company's shares are commanding a modest 4% premium in the grey market, indicating tempered expectations for its listing.
IPO Details and Subscription Rates
The Rs 40.00 crore IPO was priced in the range of Rs 78-83 per share and garnered significant interest from investors across categories. The overall subscription rate stood at an impressive 8.28 times, reflecting strong demand for the company's shares. Here's a breakdown of the subscription rates:
| Investor Category | Subscription Rate |
|---|---|
| Qualified Institutional Buyers (QIBs) | 9.91 times |
| Non-Institutional Investors | 9.38 times |
| Retail Investors | 6.89 times |
Additionally, anchor investors showed confidence in the company by committing Rs 11.39 crore before the issue opened to the public.
Company Profile and Financial Performance
Prime Cable Industries operates under the brand names Primecab and Renufo, catering to various sectors including power generation, oil and gas, mining, steel, and real estate. The company has demonstrated strong financial growth:
- Revenue: Increased by 71% to Rs 141.10 crore
- Profit After Tax: Surged by 319% to Rs 7.50 crore
IPO Proceeds Allocation
The funds raised through the IPO will be utilized for the following purposes:
| Purpose | Amount (in Rs crore) |
|---|---|
| Capital Expenditure | 14.46 |
| Loan Repayment | 4.48 |
| Working Capital | 7.89 |
Ownership Structure and Valuation
Post-IPO, the promoter holding in Prime Cable Industries will decrease from 92.9% to 68.2%. At the upper price band of the IPO, the stock is trading at a price-to-earnings (P/E) ratio of 20.3 times.
Market Outlook
While the strong subscription rates indicate investor interest in Prime Cable Industries, the modest grey market premium suggests a cautious outlook for the stock's listing performance. Investors and market watchers will be closely monitoring the company's performance in the coming days to gauge its potential in the competitive cable and wire manufacturing sector.
As Prime Cable Industries embarks on its journey as a publicly traded company, it will be interesting to see how it leverages its market position and the funds raised through the IPO to drive future growth and create value for its shareholders.
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