Bansal Wire IPO: Top 10 Must-Know Details from RHP Before Investing

The Bansal Wire IPO is open for subscription from July 3 to July 5, 2024. Here are 10 important things to know from the Red Herring Prospectus (RHP) before you decide to invest:

1. Subscription Details
   • The IPO is open for subscription from July 3 to July 5, 2024.
   • The price range is set between ₹243 to ₹256 per share.
   • Retail investors need to apply for at least 58 shares, with a minimum investment of ₹14,848.
2. Objectives of the Issue
   • The funds raised will be used to repay or partially repay certain loans.
   • Some funds will also be used for working capital and general corporate purposes.
3. About the Company
   • Bansal Wire is a major manufacturer of stainless steel wire and the second largest in India by volume.
   • In Fiscal 2023, it produced 72,176 metric tonnes per annum (MTPA) and had a market share of 20% and 4%, respectively.
4. Key Risks
   • Any shortages or delays in the supply of raw materials could negatively impact the business.
   • Any disruptions or shutdowns at manufacturing facilities could also have adverse effects.
5. Promoters
   • The company’s promoters are Arun Gupta, Anita Gupta, Pranav Bansal, and Arun Kumar Gupta HUF.
6. Industry Landscape
   • The wire manufacturing market is highly fragmented with over 100 players.
   • The top 10 manufacturers hold around 22% of the market, with Tata Wires and Bansal Group meeting about 13% of the demand.
   • There is a shift from unbranded to branded products in the market.
7. Comparison with Listed Peers
   • Listed peers include Rajratan Global Wire Limited, trading at 55.52 times its price-to-equity ratio for FY23 with an EPS of ₹19.72 and a Return on Net Worth of 23.15%.
   • Bansal Wire’s EPS is ₹7.21 and its Return on Net Worth is 21.21%.
   • Other listed peers are D.P. Wires Ltd and Bedmutha Industries Ltd.
8. Registrar and Book Running Manager
   • The book running lead managers are SBI Capital Markets Limited and Dam Capital Advisors Ltd.
   • The registrar is Kfin Technologies Limited.
9. Allotment and Listing Details
   • The allotment is expected to be completed on Monday, July 8, 2024.
   • The IPO is planned to be listed on the BSE and NSE on Wednesday, July 10, 2024.
10. Grey Market Premium (GMP)
    • The GMP for the Bansal Wire IPO today is +58, indicating a grey market price of ₹314 per share, which is 22.66% higher than the upper IPO price of ₹256.

The grey market premium (GMP) reflects the extra amount investors are willing to pay over the issue price.