RR Kabel Makes History with T+2 Listing, Debuting at 14% Premium at Rs 1180

20 September 2023
3 mins read
by Angel One
The company's revenue grew by 27% YoY in FY23, the highest among its competitors in the same space.
RR Kabel Makes History with T+2 Listing, Debuting at 14% Premium at Rs 1180

RR Kabel Limited is involved in the manufacturing, marketing, and sale of wires and cable products under the ‘RR Kabel brand and fans and lights under the ‘Luminous Fans and Lights brand, debuted with a 14% premium, trading at Rs 1179 per share on the BSE. On the NSE, the stock opened at Rs 1180, marking a 14% increase from its initial public offering price of Rs 1035 per share.

As of the time of writing, the stock is trading at Rs 1161 on the BSE, with intraday highs and lows of Rs 1198 and Rs 1143, respectively. The current market capitalization of the company stands at Rs 13,086 Crore.

Furthermore, the company has achieved the distinction of becoming the first IPO firm to complete its listing within the T+2 timeline.

The company plans to primarily utilize the proceeds from the new issue to repay debt, with the remaining funds allocated for general corporate purposes.

Company profile

Established in 1995, RR Kabel Limited specializes in consumer electrical products designed for various applications, including residential, commercial, industrial, and infrastructure.

The company operates within two main segments: wires and cables, offering a wide range of products such as house wires, industrial wires, power cables, and special cables; and FMEG (Fast-Moving Electrical Goods), which includes fans, lighting solutions, switches, and various electrical appliances.

RR Kabel is renowned for its manufacturing, marketing, and sale of wires and cable products under the ‘RR Kabel brand, as well as fans and lights under the ‘Luminous Fans and Lights brand.

Let’s recap the subscription history of the company

On the final day of the IPO window on September 15, 2023, the IPO witnessed a subscription rate of 18.69 times. The public issue received an overwhelming response, with the retail category subscribed 2.13 times, the QIB category achieving a subscription rate of 52.26 times, and the NII category reaching a subscription rate of 13.23 times.

The company had attracted Rs 585.62 crore from various anchor investors, allocating 56.58 lakh equity shares at Rs 1035 per share to anchor investors.

The IPO price range was set between Rs 983 and Rs 1035, with a face value of Rs 10 per share and a lot size of 14 shares. The total size of the company’s IPO was Rs 1,964 Crore, and the final share issue price was fixed at Rs 1035 each.

Following is the financial performance of the company: 

Particulars FY21 (Rs Cr) FY22 (Rs Cr) FY23 (Rs Cr)
Revenue 2745.94 4432.22 5633.64
Net Profit / (Loss) 135.40 213.94 189.87
Total Assets 1715.11 2050.64 2633.62
Total Borrowings 498.71 521.11 515.84
Net Worth 1033.38 1237.05 1390.47

The crucial question that arises in everyone’s mind is whether to hold onto the shares or book profits. Considering the current market conditions Nifty is trading near its all-time high levels, investors who applied for listing gains have already earned 14% on the listing day alone and can choose to book the profit it has generated.

On the other hand, looking at the wealth generated by the companies listed in the same space, investors with a higher risk appetite may opt to hold the shares for the medium to long term, which could prove to be beneficial.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions