BackPlaza Wires IPO: Issue booked over 27 times on day 2; check GMP, should you subscribe?
Plaza Wires IPO subscribed over 27 times, with retail portion oversubscribed 118.96 times. Price band set at ₹51 to ₹54 per share.
PremiumPlaza Wires IPO opened for subscription on Friday, September 29, and will close on Wednesday, October 4. The Plaza Wires IPO received a fantastic reaction from investors within the first hour of subscription on day 2, and the Plaza Wires IPO subscription status was completely booked and subscribed over 27 times, with the retail component oversubscribed 118.96 times. Plaza Wires IPO subscription status on day 2 was 27.90 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 2, Plaza Wires IPO retail investors portion was subscribed 118.96 times, NII portion was subscribed 53.16 times, and Qualified Institutional Buyers (QIB) portion was subscribed 42%.
Also Read: Plaza Wires IPO: Issue fully subscribed on day 1, retail portion booked over 26 times
Plaza Wires IPO subscription status details
Plaza IPO subscription status has received bids for 26,49,08,119 shares against 94,96,114 shares on offer, according to data from the BSE.
Plaza Wires IPO retail investors' portion received bids for 15,70,25,483 shares against 13,20,015 shares on offer for this segment.
Plaza Wires IPO 's non-institutional investors' portion received bids for 10,52,50,305 shares against 19,80,023 on offer for this segment.
Plaza IPO Qualified Institutional Buyers (QIBs) portion received bids for 26,32,331 shares against 61,96,076 shares on offer for this segment.
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.
Plaza Wires IPO GMP today
Plaza Wires IPO GMP today or grey market premium is +24. This indicates Plaza Wires share price were trading at a premium of ₹24 in the grey market on Friday, 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 ₹78 apiece, which is 44.44% higher than the IPO price of ₹54.
'Grey market premium' indicates investors' readiness to pay more than the issue price.
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.
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.
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