R R Kabel lists at 13.9% premium in line with grey market expectations

• The stock debuted at ₹1,179 as compared to its IPO price of ₹1,035 per share.
• Its market cap is at ₹13,301 crore according to Bombay Stock Exchange.
• It plans to use net proceeds towards loan payment and general corporate purposes.
  

The stock of wire and cable manufacturer R R Kabel listed on the bourses on Wednesday at a 13.9% premium, a tad over grey market predictions of 10% listing gains. The stock debuted at ₹1,179 as compared to its IPO price of ₹1,035 per share. Its market cap is at ₹13,301 crore according to Bombay Stock Exchange.

R R Kabel which closed its subscription on September 15, will be the first company to list under the T+2 regime where an issue marks its exchange listing within two working days of the issue closing.

Its initial public offer was subscribed 18.6 times the shares on offer. The issue received more interest from qualified institutional buyers (QIBs) and non-institutional investors than retail investors.

The issue consisted of a fresh issue to the tune of ₹180 crore, an offer for sale up to 17,236,808 equity shares by shareholders.

The company proposes to utilise the proceeds raised through the fresh Issue towards repayment or prepayment, in full or in part, of borrowings availed by the company from banks and financial institutions; and general corporate purposes.

The company sells products across two broad segments — wires and cables including house wires, industrial wires, power cables and special cables; and fast moving electrical goods including fans, lighting, switches and appliances.

It has five manufacturing facilities at Waghodia in Gujarat; Silvassa; Roorkee in Uttarakhand; Bengaluru; and Gagret in Himachal Pradesh. It has 7% market share in branded wires and cables market in India.

The company is growing at a compounded annual growth rate of 43.4% between FY21 and FY23, the company said in its RHP.

Apart from fluctuations in raw materials, forex fluctuations, union issues and inability to maintain distribution network, the company is also exposed to credit terms extended to customers, warranty claims, impact of counterfeits and product defects.

The company has undertaken 208 criminal cases and 32 tax proceedings and the aggregate amount involved is ₹46.1 crore. It has seven tax proceedings and one statutory/regulatory proceeding which involves an amount of ₹6.8 crore. They are pending at different levels of adjudication, the RHP says.