Bansal Wire IPO Day 2: Should You Buy? Check GMP, Subscription Status, and Expected Listing Price Now!

The Bansal Wire IPO got off to a great start on its first day of bidding on July 3, with strong interest from retail and non-institutional investors. By the end of the day, the IPO was subscribed 1.76 times, according to BSE data.

The retail investor portion was subscribed 2.47 times, while the non-institutional investor (NII) part was subscribed 2.44 times. One percent of the shares are reserved for Qualified Institutional Buyers (QIBs).

Bansal Wire Industries has allocated 15% of its shares for NIIs, 50% for QIBs, and 35% for retail investors.

On Tuesday, Bansal Wire Industries announced it had raised over ₹223 crore from major investors. The company is involved in the manufacturing and exporting of steel wire, operating in three main areas: high carbon steel wire, mild steel wire (low carbon steel wire), and stainless steel wire.

The company plans to strengthen and expand its market position in the next fiscal year by adding a new specialty wire sector through its upcoming Dadri factory.

Bansal Wire Industries IPO Details:

IPO Review – Anand Rathi Research: The company has a market capitalization of ₹40,078.3 million after issuing equity shares, with a market cap-to-sales ratio of 1.62 times its FY24 earnings. The company’s P/E ratio is 50.8 times based on FY24 earnings.

Bansal Wire Industries and its subsidiary, Bansal Steel & Power Limited, offer over 3,000 SKUs of steel wire products, including high carbon steel, mild steel (low carbon), and stainless steel wires. The subsidiary offers around 1,500 SKUs, while the company offers about 2,000 SKUs. Based on these factors, the brokerage advises a “Subscribe – Long Term” rating for the IPO.

Sushil Finance: The company has maintained a year-over-year client retention rate of 64.74% in FY22, 66.06% in FY23, and 68.49% in FY24. It sells around 86% of its output domestically and exports the remaining portion, with over 70% of export earnings coming from the US and European wire markets.

The revenue CAGR was around 5.9% from FY22 to FY24. For FY24, the company’s EBITDA margin was 6.04%, and its PAT margin was 3.19%, with returns on equity of 21.19% and 18.46%, respectively.

Using diluted EPS for FY24 (₹6.18), the company is asking for a PE multiple of 41.4x at the higher end of the pricing band. The industry average is 32.72x, and the P/BV for FY24 is 7.72x. Considering all factors, risks, and high value, investors may choose to subscribe to the issue with a medium- to long-term perspective.

Bansal Wire Industries IPO Details: The ₹745 crore IPO includes a fresh issue of 29,101,562 equity shares with no offer-for-sale (OFS) component. The funds will support the company’s current operations and proposed projects.

SBI Capital Markets Limited and Dam Capital Advisors Ltd (formerly Idfc Securities Ltd) are the book running lead managers of the IPO, with Kfin Technologies Limited as the registrar.

Bansal Wire Industries IPO GMP Today: The IPO GMP today is +60, indicating Bansal Wire Industries shares are trading at a premium of ₹60 in the grey market, according to investorgain.com. The expected listing price is ₹316 per share, 23.44% higher than the IPO price of ₹256, considering the top end of the IPO pricing band and the existing grey market premium.

The grey market premium shows investors’ willingness to pay above the issue price.