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Bansal Wire Industries Plans to IPO, Raise Rs. 745 Cr. in Fresh Issue

Bansal Wire Industries, an Indian manufacturer and supplier of Galvanised Iron (GI) and Steel wires, has plans to roll out its IPO and has submitted the Draft Red Herring Prospectus (DRHP) to the Securities and Exchange Board of India (SEBI) for the same. As per the DHRP, the size of this issue will be Rs. 745 crore.

About Bansal Wire Industries: Product Offerings and Financials

SS Wires

Bansal Wire Industries’ portfolio comprises Stainless Steel wires and bars, Steel cold heading wires, spring wires, welding wires, roping wires, Aluminuim alloy wires, Copper-coated Aluminium and Steel wires, High Carbon Steel wires, Low Carbon Steel wires, Hot-dipped GI wires and electro-Galvanised wires, cable armouring wire strips and more.

The company’s revenue from its operations stood at Rs. 2,413 crore, with a corresponding Profit After Tax (PAT) of Rs. 59.98 crore for FY-23.

Further, Bansal Group comprises six companies, namely Bansal Wire Industries Ltd., Bansal Steel and Power Limited, Paramhans Wire Pvt. Ltd., Balaji Wire Pvt. Ltd., Bansal High Carbon Pvt. Ltd., and Bansal Aradhya Steel Pvt. Ltd.

Fresh Shares to be Issued, Proceeds to Repay Debt & Fund General Expenses

Bansal Wire’s issue will comprise entirely of fresh shares, and the proceeds raised from the IPO will go towards debt repayment, feeding working capital and funding general corporate expenses. These shares will have a face value of Rs. 5 each.

Utilisation Break-up of Bansal Wire Issue’s Net Proceeds

The company plans to utilise about Rs. 546.39 crore out of the net proceeds to repay its debt. Out of this Rs. 452.68 crore will be used by Bansal Wire Industries, while Rs. 93.71 crore will be availed by the company’s subsidiary, Bansal Steel & Power Limited. The aforementioned debt repayment will be done in full in FY-24.

Apart from debt repayment, Bansal Wire Industries will use Rs. 60 crore towards feeding its working capital requirements, out of which Rs. 30 crore will be used in FY-24, leaving Rs. 30 crore to be used during FY-25.

Further, Bansal Wire’s DHRP clarified that not more than 25% of the net proceeds from this issue shall be used for general corporate expenses as approved by the company’s management.

Allocation of Shares

Bansal Wire Industries’ DHRP specifies that not more than 50% of the issue shall be available for Qualified Institutional Buyers (QIBs), a minimum of 15% of the shares will be available for Non-Instituional Investors (NIIs), and a minimum of 35% of the offering shall be available to retail investors for subscription.