DCG Cables & Wires Ltd IPO: Review, Valuation, Date & GMP

DCG Cables & Wires Limited IPO - Complete Overview

Established in 2017, DCG Cables & Wires Limited specializes in the production of copper cables and wires primarily for transformer manufacturers across India. 

The company's product range includes Copper Strips, Paper Covered Copper Strips and Wires (Kraft/Crepe/Nomex/Mica), Bare Copper Wires and Strips, Copper Tapes, and Fiber Glass Copper.

Operating across three manufacturing units located in Odhav and Kubadthal in Ahmedabad, as well as Waghodia in Vadodara, the company boasts a combined installed capacity of 5,868 MT for manufacturing bare Copper wire & Strips, 1,404 MT for Paper Covered Copper Strips & wire, 1,512 MT for Cable Wires, 5,760 MT for Copper Rods, 10,080 MT for Copper Flats, 972 MT for Submersible Wires, and 540 MT for Fiber Glass Covered Copper Strips.

With plans underway to establish a new manufacturing plant in Bhayala, Bavla, Gujarat, the company aims to further augment its manufacturing capabilities.

As of February 29, 2024, the company reported a total revenue of Rs 7,639.08 Lac.

 

DCG Cables & Wires Limited IPO Overview

DCG Cables & Wires Limited IPO date is slated to be open for subscription from April 8, 2024, to April 10, 2024. This NSE SME IPO follows a Fixed Price Issue IPO.

DCG Cables & Wires Limited IPO price is fixed at Rs.100 per share. 

The total issue size of this IPO amounts to Rs.49.99 Cr. The company has allocated shares 50% to retail investors and 50% to other investors.

 

 

Company Financial

Compared to the previous financial year, DCG Cables & Wires Limited has seen growth in total assets, net worth, and total revenue. The profit after tax and total borrowing has also increased.

(Amount in Lakhs)

Period	29 Feb 2024	31 Mar 2023	31 Mar 2022
Total Assets	6,152.13	3,564.12	-
Total Revenue	7,639.08	5,455.18	-
PAT	847.10	172.06	37.24
Net worth	2,367.15	1,533.82	443.69
Reserve & Surplus	1,051.78	217.99	-
Total Borrowings	2,569.83	1,812.27	635.44

 

The Objective of the Issue

The Company proposes to utilize the Net Proceeds for the following objects:

1. Capital Expenditure for building construction 

2. Working capital requirement 

3. General Corporate Purpose, 

4. Meeting Public Issue Expenses. 

 

 

 

Peers of DCG Cables & Wires Limited IPO 

Name of the Company	Face Value (Rs)	EPS (Rs)	P/E Ratio
DCG Cables and Wires Limited	10.00	1.31	15.53
Cords Cable Industries Limited	10.00	5.52	31.92
Universal Cables Limited	10.00	18.21	30.43

 

Evaluation

The IPO is priced at Rs.100 per share.

Evaluation of P/E Ratio

• Considering the FY23 EPS of Rs 1.31 from the last year, the resulting P/E ratio is 76.34x.

• Taking into account the weighted EPS of Rs 17.93 for the last three years, the P/E ratio amounts to 5.57x.

Comparative Analysis with Listed Peers

• The industry's average P/E is 31.92x.

As a result, the IPO price range, with a P/E ratio ranging from 76.34x to 5.57x, seems fully priced to the industry average of 31.92x.

 

IPO's Strengths

• Outstanding product quality

• Expertise in customization

• Competitive Pricing

• Long-standing reputation for reliability and consistency

• Extensive experience of our promoters

 

 

 

IPO Weaknesses

• The company has utilized a dealer finance facility from SG Finserve Limited amounting to Rs 300 lacs, with a charge created on its current assets. Notably, this was done without obtaining a No Objection Certificate (NOC) from the State Bank of India, which had previously sanctioned a working capital limit against the company's current assets.

• Despite the applicability of registration under the PF and ESIC Act since FY 2021-22, the company has not applied for such registration. Additionally, it has been irregular in depositing the Provident Fund and ESIC contributions collected from employees' salaries with the respective authorities, as well as in filing returns as per the Acts.

• The company has a limited number of suppliers and customers.

• There is an outstanding litigation against the company.

• The company needs to obtain and renew various registrations, licenses and permits from government and regulatory authorities.

• The company's operations are confined to the state of Gujarat.

 

IPO GMP Today

The Latest GMP of DCG Cables & Wires Limited is Rs.5.

 

DCG Cables & Wires Limited IPO timetable (Tentative)

DCG Cables & Wires Limited IPO is scheduled from April 8 to April 10, 2024, with allotment on April 12, refund initiation on April 15, and listing on April 16, 2024.

Events	Date
IPO Opening Date	April 8, 2024
IPO Closing Date	April 10, 2024
IPO Allotment Date	April 12, 2024
Refund Initiation	April 15, 2024
IPO Listing Date	April 16, 2024

 

DCG Cables & Wires Limited IPO Details 

DCG Cables & Wires Limited IPO, with a face value of Rs.10 per share, opens on April 8 and closes on April 10, 2024, offering 4,999,200 shares at Rs.100 per share, with a lot size of 1200 shares, aiming to raise Rs.49.99 Cr, and will be listed on NSE SME.

IPO Opening & Closing Date	April 8, 2024 to April 10, 2024
Face Value	Rs.10 per Share
Issue Price	Rs.100 per share
Lot Size	1200 Shares
Price of 1 lot	1200 Shares
Issue Size	4,999,200 Shares (aggregating up to Rs.49.99 Cr)
Fresh Issue	4,999,200 Shares (aggregating up to ₹49.99 Cr)
Listing at	NSE SME
Issue Type	Fixed Price Issue IPO
Registrar	Bigshare Services Pvt Ltd.

 

 

 

DCG Cables & Wires Limited IPO Lot Details 

For DCG Cables & Wires Limited IPO, the retail investor minimum and maximum lot investments are both 1 lot (1200 shares) at Rs.120,000 while for HNI investors, the minimum investment is 2 lots (2400 shares) at Rs.240,000.

Minimum Lot Investment (Retail)	1 lot
Maximum Lot Investment (Retail)	1 lot
Minimum Lot Investment (HNI)	2 lot

 

DCG Cables & Wires Limited IPO Reservation 

Other Investors share Portion	50%
Retail Investors share Portion	50%

 

Promoters and Management of DCG Cables & Wires Limited

• Mr. Devang Patel

• Mr. Harshadbhai Patel

• Ms. Ushaben Patel 

Pre-issue Promoter shareholding	100.00%
Post-issue Promoter shareholding	72.45%

 

DCG Cables & Wires Limited IPO Lead Managers

• Interactive Financial Services Ltd 

 

Dividend Policy

The Company has not declared or paid any dividends on the Equity Shares in the past. The future payment of dividends will depend on the financial performance of the company.

 

 

 

Conclusion

The company presents a good opportunity for investors to invest in its upcoming IPO. The higher expenditure by the Government of India in the energy sector is expected to benefit the company. Additionally, the company has several expansion plans in place, and its revenue growth is evident. Investors, after evaluating all factors, are poised to invest their funds in the issue for optimal gains.

 

Finowings IPO Analysis

Hope you enjoyed the Finowings IPO Analysis. We tried our best to give every required detail about the company that you should know before applying to the IPO. 

You must consult your financial advisor before making any financial decisions. 

To Apply for the IPO, Click Here.

 

To Read the Prospectus of the Company Click Here to Download the DRHP.

 

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