Plaza Wires IPO: Bidding ends tomorrow. Check GMP, subscription status on day 3, apply or not?

Plaza Wires IPO opened for subscription on Friday, September 29, and will close on Thursday, October 5. For the last two days of subscription, investors responded incredibly well to the Plaza Wires IPO and today—the third day—the trend seems to have got even better. On day 3, Plaza Wires IPO subscription status is 62.75 times. 

The company has fixed the price band at ₹51 to ₹54 per equity share for the proposed initial public offer.

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Plaza Wires IPO has reserved not less than 75% of the shares in the public issue for Qualified Institutional Buyers (QIB), not more than 15% for Non Institutional Investors (NII), and not more than 10% of the offer is reserved for Retail Investors.

On day 3, Plaza Wires IPO retail investors portion was subscribed 224.95 times, NII portion was subscribed 132.89 times, and Qualified Institutional Buyers (QIB) portion was subscribed 5.79 times.

Also Read: Plaza Wires IPO: Issue booked over 27 times on day 2; check GMP, should you subscribe?

Plaza Wires IPO subscription status details

Plaza IPO subscription status has received bids for 59,59,19,795 shares against 94,96,114 shares on offer, according to data from the BSE.

Plaza Wires IPO retail investors' portion received bids for 29,69,37,352 shares against 13,20,015 shares on offer for this segment.

Plaza Wires IPO 's non-institutional investors' portion received bids for 26,31,22,854 shares against 19,80,023 on offer for this segment.

Plaza IPO Qualified Institutional Buyers (QIBs) portion received bids for 3,58,59,589 shares against 61,96,076 shares on offer for this segment.

Also Read: Plaza Wires IPO: Issue fully subscribed on day 1, retail portion booked over 26 times

Plaza Wires IPO details

Plaza Wires IPO, which is worth ₹71.28 crores, is completely a fresh issue of 13,200,158 equity share; there is no offer for sale (OFS) component.

The company plans to use the net proceeds from the offering to pay for the following items, including funding the capital expense for opening a new manufacturing facility to produce house wires, fire-resistant wires and cables, aluminium cables and solar cables to broaden the product line, funding the company's working capital needs and general corporate purposes.

Plaza Wires IPO's book-running lead manager is Pantomath Capital Advisors Pvt Ltd, while the issue's registrar is Kfin Technologies Limited.

Also Read: Plaza Wires IPO: Check subscription status on day 1, GMP, review, other key details to know

Plaza Wires IPO GMP today

Plaza Wires IPO GMP today or grey market premium is +23. This indicates Plaza Wires share price were trading at a premium of ₹23 in the grey market on Wednesday, according to investorgain.com

Considering the upper end of the IPO price band and the current premium in the grey market, the estimated listing price of Plaza Wires share price was indicated at ₹77 apiece, which is 42.59% higher than the IPO price of ₹54.

'Grey market premium' indicates investors' readiness to pay more than the issue price.

Also Read: Plaza Wires IPO: Firm mobilises ₹20 crore from anchor investors ahead of issue

Plaza Wires IPO review

According to Dilip Davda, the contributing editor at Chittorgarh.com, the company is operating in a highly competitive segment with many big players around. It marked steady growth in its top and bottom lines for the reported periods, the issue appears fully priced based on its FY23 earnings. Considering its expansion plans, investors may park funds for the medium to long-term rewards.

According to Kris Arun Kejriwal, Founder, Kejriwal Research and Investment Services an advisory firm, the overwhelming response that Plaza Wires has received from retail investors is two fold.

First, the bucket size is lower at 10% of the issue size. Second, looking at the success that RR Kable had, recently, investors believed that company would give them similar returns. As far as the prospects of the company are concerned, its a small player, having a large basket or portfolio of products, including outsourced Fast-Moving Electric Goods (FMEG), its a tough business, and the company needs to perform post being listed.

“I believe the euphoric response from retail investors is a bit misleading and probably out of context, listing gains even though the price band appears to be quite low in the range of ₹51 and ₹54, could be a dampener when the shares list,” explained Kejriwal.

According to Vinit Bolinjkar, Head of Research, Ventura Securities, Plaza Wires is a high growth business with reasonable valuations and raising cash for capex and working capital requirements. 

“We recommend a ‘Buy’ for listing gains,” said Bolinjkar.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.