Polycab India Ltd. is offering nearly 2.5 crore equity shares at a price band of Rs 533-538. Some of its promoters, including the World Bank’s lending arm International Finance Corporation, will sell stake in the IPO.
The IPO is open for subscription till 09 Apr 19.
Salient Features of the Company are as following:
Selling cables & wires and fast-moving electronic goods (FMEG), comprising electric fans, LED lightnings and luminaries and switch gears, under the brand name 'POLYCAB'.
It has a market share of 12% in the country's Rs 52,500-crore cables and wires industry which is quite a significant share.
Strengths
Superior Network
Brand recognition
Backward Integration
Risks
Major risk is fluctuation in the price of raw material like PVC, Copper and aluminium which are pegged to US dollar rate.
You can see the comparison of polycab companies in the market in the below screenshot to get a better perspective.
Opinion to Subscribe or Not
It is a quality company which is reasonably priced at a price to book value of 2.5 times as per FY18 financials as compared to a median price to book of industry peers at 9.4 times. Thus we recommend a buy on the stock. As a disclosure the writer may be investing in the IPO.
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