Review By Dilip Davda on February 20, 2014
B. C. Power Control Ltd :(BCPCL) is one of the leading players in the Wire & Cable Industry and is among the largest Wire & Cable manufacturers in India. Driven by innovation and heavy investment in Research & Development, the company introduces wires with prime concern on safety, security and durability. In the year 2010, the Company made the backwards integration installing the Copper and Aluminium wire drawing facility which, in turn, added value to the organization in terms of economies of scale and production of Copper and Aluminium wires. BCPCL manufacturers of Wires & Cables which include Armoured Cable, Unarmoured Cable,Flexible & House Wires, Submersible Cable, Control & Instrumentation Cable.
To meet its working capital and general corpus fund requirements the company is coming out with an IPO of 5760000 equity share of Rs. 10 each with a fixed price of Rs. 18 per share (i.e. with a premium of Rs. 8 per share) to mobilize Rs. 10.37 crore. Issue opens for subscription on 24.02.14 and will close on 28.02.14. Minimum application is to be made for 8000 shares and in multiples thereof, thereafter. Shares will be listed on BSE SME. Sarthi Capital Advisors Pvt. Ltd. is the sole lead manager and Bigshare Services Pvt Ltd. is the registrar to the issue. Its current equity capital is Rs. 6 crore. Post issue it will stand enhanced to Rs.11.76 crore. On 31.03.2011 and 30.03.2012 it issued 994000 and 906000 equity shares to promoters at a price of Rs. 50 per share and then issued bonus in the ratio of 2 for 1 taking the total equity to Rs. 6 crore.
On performance front, for past three fiscals it has posted an average EPS of Rs. 2.80 on an equity capital of Rs. 2 crore. For six months ended 30.09.13 it has earned net profit of Rs. 0.08 crore on a turnover of Rs. 46.86 crore giving an annualized EPS of Rs. 0.27 and if we attribute this earnings on enhanced equity then EPS comes to Rs. 0.14 per share and this translated the asking price at a P/E of 128+ and at a P/BV of 1+ with NAV at Rs. 16.95 as at 30.09.13.
On the merchant banker’s front, this is the 5th mandate from it in SME sector till date and has mixed trends post listing for earlier four mandates.
Avoid this highly priced issue that also has entry barrier.
Review By Dilip Davda on February 20, 2014
Dilip Davda is a veteran financial journalist associated with the Indian stock market since 1978. He has been contributing to print and electronic media on capital markets, insurance, and finance since 1985.
He is widely recognized for reviewing public issues and non-convertible debentures (NCDs) in the primary market. Drawing on over three decades of market experience and close interaction with merchant bankers, his reviews focus on detailed fundamental and financial analysis of companies, with a special emphasis on SME public issues.
Dilip Davda
SEBI Registered Research Analyst – Mumbai
Registration No.: INH000003127 (Perpetual)
Email: dilip_davda@rediffmail.com
Disclaimer: The information provided herein is solely for educational and informational purposes and does not constitute an offer, solicitation, or recommendation to buy or sell any securities. Readers are advised to consult a qualified financial advisor before making any investment decisions. Investments in the securities market are subject to market risks. The author does not intend to invest in the securities discussed.
The initial public offer (IPO) of B.C.Power Controls Ltd. offers an early investment opportunity in B.C.Power Controls Ltd.. A stock market investor can buy B.C.Power Controls IPO shares by applying in IPO before B.C.Power Controls Ltd. shares get listed at the stock exchanges. An investor could invest in B.C.Power Controls IPO for short term listing gain or a long term.
Read the B.C.Power Controls IPO recommendations by the leading analyst and leading stock brokers.
B.C.Power Controls IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the B.C.Power Controls IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts mentioned in the above answer to "How is B.C.Power Controls IPO?"
Our recommendation for B.C.Power Controls IPO is to avoid.
As per the analysis by our lead analyst Mr. Dilip Davda, we suggest you to avoid the B.C.Power Controls IPO.
The B.C.Power Controls IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit B.C.Power Controls IPO allotment status to check.
