Polycab India eyes to raise around Rs 1,345 crore through IPO

Wires and cables manufacturer Polycab India plans to raise around Rs 1,345 crore through a mix of fresh issue of equity shares and an offer for sale, which will be launched on April 5.

The issue, which includes Rs 400 crore of fresh issue and an offer for sale (OFS) of 17,582,000 shares of face value of Rs 10 a piece, will close on April 9.

The price band of the issue is fixed at Rs 533-538 per equity share.

The offer includes a reservation of up to 175,000 equity shares for employees.

"We plan to utilise the proceeds of the issue for partially retire our debts as well as for meeting our working capital requirements," its deputy chief financial officer Gandharv Tongia told PTI here.

Out of the Rs 400 crore of fresh issue, Polycab plans to use nearly Rs 80 crore for scheduled repayment of all or a portion of certain borrowings availed by the company, Rs 240 crore would be spent towards meeting incremental working capital requirements and the remaining will be utilised for general corporate purposes.

According to estimates, the Indian wires and cables industry is expects to grow at a CAGR of 15 percent to reach an estimated Rs 1.03 trillion by fiscal 2023, largely due to various government initiatives in power and infrastructure.

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"Also an increase in industrial investment, a rise in consumer spending and an increase in exports of wires and cables from India will drive the growth. We intend to capture such growth by leveraging on our brand, product quality and strong distribution network," he said.

When asked whether the company was planning any capital expenditure for increasing its manufacturing capacities, Tongia said, "we have already spent nearly Rs 1,100 crore in the last five years. We will continue to spend on capex but the numbers will however be tapered down."

The company has manufacturing facilities in Daman and Halol in Gujarat.

The company had reported total revenues of Rs 6,985.90 crore as on March 31, 2018 and PAT of Rs 370.24 crore.

The global co-ordinators and book running lead managers to the offfer are Kotak Mahindra Capital Company, Axis Capital, Citigroup Global Markets India and Edelweiss Financial Services.

The book running lead managers are IIFL Holdings and YES Securities (India).