Bharat Wire Ropes' IPO set to hit markets

Bharat Wire Ropes (BWR) one of the leading speciality wire ropes manufacturing company in India is set to go public in the coming month.

Issue Snapshot

Manufacturer of wire ropes is planning to raise funds through fresh issue of shares of up to 700 million equity shares by promoters. The offer is expected to hit the markets may be by the end of March,2016. The price band for the offer is yet to be fixed. Since the new issue size is less than Rs 500 crore, the company is not subject to monitoring by any independent agency under SEBI regulations. The book running lead managers for this offer are Bank of Baroda and Intensive Fiscal Services.

Company Profile

The company was originally promoted by the Shah Group and in the year 2010, equity shares were purchased by one of the current promoters - Gaji Mercantile Private Limited under SPA dated June 30, 2010. BWR are a wire rope and wires manufacturing company established in the year 1986. Company is engaged in manufacturing and sales of wire ropes, structural strands, slings and wires which find its application in general engineering, fishing, elevators, cranes, material handling, power transmission, suspension bridges, onshore / offshore oil exploration, ports and shipping, mining, defence, railways etc. BWR is also engaged in the business of trading of the steel related products. Company has a steel wire ropes manufacturing facility with an installed capacity of 12,000 MTPA, which is located at Atgaon. Companies products are utilized in various parts of the country. BWR's presence in the global market has been rapidly increasing to include countries such as USA, Germany, Spain, Qatar, Egypt, UAE, South Africa, Australia, Nepal, Uganda, Singapore, Mauritius and Oman.

Utilization of IPO Funds

According to the BWR’s DRHP (Draft Red Herring Prospectus), BWR intends to use the IPO proceeds primarily for setting up of proposed project of 66,000 MTPA wire ropes at Chalisgaon, Maharashtra. Further, part of the proceeds would also be used for general corporate purpose and issue related expenses.

Financials

As per restated financials, BWR’s total revenue for financial year 2012, financial year 2013 and financial year 2014 was Rs 77.2 crore, Rs. 74.3 crore and Rs. 82.2 crore, respectively. Companies EBITDA for financial year 2012, 2013 and 2014 was Rs 8.81 crore, Rs 9.24 crore and Rs. 8.97 crore, respectively. BWR PAT for financial year 2012, 2013 and 2014 was Rs 2.14 crore, Rs 1.47 crore and Rs 1.50 crore respectively.