Bansal Wire Industries aims to raise Rs 745 crore through IPO; files DRHP with SEBI

Bansal Wire Industries' IPO: Prominent steel wire manufacturer, Bansal Wire Industries has formally filed its Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI), outlining plans to raise Rs 745 crore via an Initial Public Offering (IPO).

This significant IPO is exclusively comprised of a fresh issue of equity shares, with no component involving an Offer-For-Sale (OFS), as detailed in the DRHP officially submitted on Thursday.

Breaking down the allocation, approximately 50 per cent of the IPO shares are earmarked for qualified institutional buyers, 35 per cent for retail investors, and 15 per cent for non-institutional investors. The public offering will be conducted through the book-building process.

The financial strategy behind the IPO involves addressing key areas, including the reduction of existing debt, covering working capital requirements, and utilising the raised capital for general business needs.

Bansal Wire is the largest stainless steel wire manufacturing company and the second largest steel wire manufacturing company by volume in India with a production of 72,176 MTPA and 206,466 MTPA, respectively, in FY23.

The company's extensive product and service portfolio caters to a diverse range of industries, such as agriculture, general engineering, hardware, consumer durables, automotive, infrastructure, power and transmission, and vehicle replacement. With a broad spectrum of over 3,000 stock-keeping units, the company surpasses its peers in the Indian steel wire manufacturing sector, offering sizes ranging from a remarkably fine 0.04 mm to a substantial 15.65 mm in thickness.

Highlighting its robust financial performance, the company reported impressive figures, with total income growing from Rs 1,480 crore in FY21 to Rs 2,422 crore in FY23, reflecting a compound annual growth rate (CAGR) of 28 per cent. Profit After Tax (PAT) witnessed a notable surge of 21.6 per cent to Rs 59.9 crore during the same period, while Earnings Before Interest, Taxes, Depreciation, and Amortisation (EBITDA) exhibited a steady growth rate of 16 per cent to Rs 1,15 crore.

For the six months ending in September 2023, the company reported a revenue of Rs 1,154 crore, accompanied by a profit of Rs 38.9 crore.

The IPO's book-running lead managers are DAM Capital and SBI Capital Markets, indicating a strategic collaboration for the successful execution of this substantial financial undertaking.