Bansal Wire Industries Limited along with its Subsidiary, Bansal Steel & Power Limited, offers over 3000 SKUs (i.e., stock keeping units) in three broad segments, i.e., high carbon steel wire, mild steel wire (low carbon steel wire) and stainless steel wire, with the Company’s offering of approximately 2000 SKUs and the Subsidiary’s offering of 1500 SKUs. Further, there are approximately 500 SKUs which are common in both the Company and Subsidiary. Company operates from the four established manufacturing facilities in the National Capital Region, India, with three manufacturing facilities in Ghaziabad (U.P.) and one manufacturing facility in Bahadurgarh (Haryana). While they have built the network in order to ensure pan India presence across all regions of India, i.e., they are present in 22 states and six union territories, by way of the dealer distribution network, they have robust revenue from operations in northern states and western states in India with 65.61%, 67.78% and 64.80% of revenue from operations generated from Delhi, Haryana, Maharashtra and Uttar Pradesh in Fiscal 2022, 2023 and 2024, respectively. Company operates in three broad segments, i.e., high carbon steel wire, mild steel wire (low carbon steel wire) and stainless steel wire and they will be also adding new segment of specialty wires through the manufacturing plant in Dadri, which will help them to grow and expand the market presence in upcoming fiscals. The extensive range of the products include sizes as thin as 0.04 mm to as thick as 15.65 mm like high carbon steel wires for springs, wire for ropes, mild steel wires (low carbon steel wires), stainless steel wires, cold heading quality wires, cable armoring wires and strips, galvanized steel wires in high/ mild steel wire (low carbon steel wire) in wide range of, zinc coating, profile/ shaped wires in various steel grades in different cross sections etc. Company manufactures the products at the five manufacturing facilities. These processes use a combination of mechanized and human skills to achieve the desired standards of manufacturing. Further, the existing units have an installed capacity of 259,000 MTPA of mild steel, high carbon and stainless-steel wires at its existing four manufacturing facilities. In addition, the initial production with a capacity of 1,000 metric tonnes of high carbon wires was commenced at the facility at Dadri towards end of January 2024, and has been increased to the operation at a capacity of 3,000 metric tonnes of high carbon wires with 78.50% of the capacity utilisation till March 31, 2024, whereas the production of mild steel wire will commence from first half of Fiscal 2025 at the Dadri facility. Company is exporting the products to several countries, with 14 global representatives, covering countries like Bangladesh, Brazil, France, Germany, Israel, Italy, Netherland, South Korea, South Africa, Sri Lanka, Turkey, United Kingdom, United States of America and Vietnam. The export turnover in Fiscal 2024 was Rs 2,839.41 million, with Europe and U.S. markets accounting to more than 70% of the total exports in Fiscal 2024. As per financial performance, Bansal Wire Industries Limited has posted total income / net profits of Rs 2,205.07 Cr / Rs 57.29 Cr (FY22), Rs 2,422.56 Cr / 59.93 Cr (FY23) and Rs 2,470.88 Cr / Rs 78.79 Cr (FY24). So as per previous financials data, company has shown average results. Company has an average EPS of Rs 5.42 and average RoNW of 18.27% for last three fiscals. Issue is priced at a P/BV of 7.72 as per NAV of Rs 33.14/- as on 31.03.24. If we attribute latest earnings of FY22, FY23, and FY24 on fully diluted equity post issue, then asking price is at a P/E of around 69.96, 66.88, and 50.86 respectively, which looks aggressively priced. As per RHP, comparison between listed peers is given in above table. On BRLM's front, two lead managers are associated with this IPO, and have handled around 30 IPOs in last three fiscals. SBI Capital Markets Limited: This is 18th main board IPO from this BRLM. From last 10 IPOs, four opened below issue price and remaining opened above issue price or at par on the day of listing. As of now, from last 10 IPOs, three are trading below issue price and remaining are trading above issue price. (As on 28.06.2024) DAM Capital Advisors Limited: This is 14th main board IPO from this BRLM. From last 10 IPOs, five opened below issue price and remaining opened above issue price or at par on the day of listing. As of now, from last 10 IPOs, six are trading below issue price and remaining are trading above issue price. (As on 28.06.2024) As per financials, Bansal Wire Industries Limited has shown average results, RoNW is 18.27% and P/E is respectively 69.96, 66.88, and 50.86 as per FY22, FY23, and FY24 earnings. So, issue looks aggressively priced. Once expansion is completed, we may see good sales growth. Company is in business of mainly high carbon steel wire, mild steel wire (low carbon steel wire) and stainless steel wire, which is highly competitive and fragmented business segmented. Performance of BRLM is average. So, we give NEUTRAL rating for this IPO. Readers must consult a qualified financial advisor prior to making any actual investment decisions.
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