Unraveling the Opportunity: A Deep Dive into Prime Cable Industries IPO

The Indian market is buzzing with investment opportunities, and Initial Public Offerings (IPOs) often capture significant attention. As investors seek avenues for growth, understanding the fundamentals of a company going public becomes paramount. Today, we turn our focus to an upcoming SME IPO – Prime Cable Industries Limited, a long-standing player in the cable manufacturing sector. This blog post will provide a comprehensive analysis, drawing insights from their offering details and market context, to help you make an informed decision.

Understanding Prime Cable Industries Limited

Established in 1997, Prime Cable Industries has grown from a proprietorship firm into a reputable Indian cable manufacturer. The company specializes in producing a diverse range of wires and cables, including LT PVC/XLPE Power, Control, and AB Cables, marketed under its well-known brand names "PRIMECAB" and "RENUFO."

Their products are critical components across various vital sectors, serving industries such as:

• Power generation, transmission & distribution
• Oil & gas
• Mining
• Steel
• Real estate

With a strong emphasis on quality, their products are ISI-marked, reflecting adherence to Indian Standards Institute certifications. As of April 30, 2025, the company had a dedicated workforce of 144 employees.

Key Strengths:

• Long-standing relationships with a distinguished clientele, fostering recurring business.
• Established vendor approvals across multiple states and proven Bid-Qualification Requirements (BQR) for government tenders.
• Stringent quality measures and consistent adherence to quality standards.
• An experienced and committed management team steering the company's strategic direction.

The IPO at a Glance: Key Details

Here's a quick overview of the essential details concerning the Prime Cable Industries IPO:

Your IPO Journey: A Timeline

Keep these important dates in mind as you navigate the Prime Cable Industries IPO process:

Understanding the Investment Structure: Lot Sizes

Investors can bid for a minimum of 1,600 shares and in multiples thereof. Here's a breakdown of the minimum and maximum investment for different investor categories based on the upper price band of ₹83 per share:

Financial Health Check

A glance at the company's financial performance provides crucial insights for potential investors.

Performance Indicators (as of March 31, 2025):

• Return on Capital Employed (ROCE): 25.96%
• Debt/Equity Ratio: 2.63
• Return on Net Worth (RoNW): 69.16%
• PAT Margin: 5.32%
• EBITDA Margin: 10.43%
• Price to Book Value: 7.81
• EPS (Pre-IPO): ₹5.32
• P/E (Pre-IPO): 15.6
• EPS (Post-IPO): ₹4.10
• P/E (Post-IPO): 20.26

The financials show robust growth with revenue increasing by 71% and Profit After Tax (PAT) surging by 319% between FY24 and FY25. While this demonstrates strong recent performance, the significant jump in PAT in the pre-IPO year often warrants closer scrutiny from investors. The company's debt-to-equity ratio of 2.63 is relatively high, which is a point for consideration.

The Guiding Hands: Promoters and Their Vision

The company is promoted by Purshotam Singla, Vijay Lakshmi Singla, Nikunj Singla, Naman Singla, and Shreya Jhalani Singla. Their collective vision has steered Prime Cable Industries to its current position.

• Promoter Holding Pre-Issue: 92.93%
• Promoter Holding Post-Issue: 68.24%

Purpose of the Public Offering: How Funds Will Be Used

The company intends to utilize the net proceeds from the IPO for the following key objectives:

• Capital Expenditure: Towards civil construction and the purchase of plant and machinery (₹14.46 crores). This indicates a focus on expanding and modernizing manufacturing capabilities.
• Debt Repayment: Partial repayment of certain existing debt facilities (₹4.48 crores). This could help improve the company's balance sheet by reducing its leverage.
• Working Capital Requirements: To fund ongoing operational needs (₹7.89 crores). Adequate working capital is vital for smooth business operations.
• General Corporate Purposes: Allocation for other strategic and operational requirements.

Strategic Investors: Anchor Details

The company successfully raised ₹11.39 crore from anchor investors on September 19, 2025. Anchor investors typically provide confidence to the market.

• Shares Offered to Anchor Investors: 13,72,800
• Anchor Portion Size: ₹11.39 Crores
• Anchor Bid Date: September 19, 2025
• Lock-in Period End for 50% Shares: October 25, 2025 (30 Days)
• Lock-in Period End for Remaining Shares: December 24, 2025 (90 Days)

SWOT Analysis: A Balanced View

A thorough evaluation involves looking at a company's internal strengths and weaknesses, alongside external opportunities and threats.

Strengths:

• Quality Assurance: ISI-marked products under established brands "PRIMECAB" and "RENUFO" ensure customer trust and reliability.
• Market Reach: Strong relationships with a diverse clientele and approvals for government tenders provide a stable business pipeline.
• Experienced Leadership: A seasoned management team contributes to strategic direction and operational efficiency.
• Recent Financial Growth: Significant revenue and profit growth in recent financial years demonstrate operational momentum.

Weaknesses:

• Competitive Landscape: Operates in a highly competitive and fragmented segment, potentially impacting pricing power and market share.
• Financial Performance Scrutiny: The substantial jump in profit right before the IPO may lead to questions about the sustainability of this growth.
• High Debt-to-Equity Ratio: A relatively high debt load could pose financial risks, especially in an adverse economic environment.
• SME Listing: Listing on the NSE SME platform might imply lower liquidity compared to mainboard exchanges.

Opportunities:

• Infrastructure Boom: India's ongoing infrastructure development (power, smart cities, real estate) drives consistent demand for cables and wires.
• 'Make in India' Initiative: Government push for domestic manufacturing could benefit local players.
• Product Diversification: Potential to expand into specialized cables or allied electrical products.
• Geographic Expansion: Untapped markets within India or even international opportunities.

Threats:

• Raw Material Price Volatility: Fluctuations in copper, aluminum, and PVC prices can impact profitability.
• Economic Slowdown: A downturn in construction, industrial, or government spending could reduce demand.
• Intense Competition: Existing and new players could intensify price wars and reduce margins.
• Technological Disruption: Emergence of new materials or manufacturing processes could require significant investment.

Should You Consider This IPO?

Prime Cable Industries operates in a critical sector that is closely tied to India's growth story. The company has demonstrated growth in its operational metrics, particularly the impressive surge in its profit after tax in the most recent fiscal year. However, investors should be mindful that such a significant jump in earnings right before an IPO often requires careful analysis to ascertain its sustainability and underlying drivers.

The cable industry is highly competitive and fragmented, which can put pressure on margins. Furthermore, being an SME IPO, it might experience different liquidity dynamics compared to mainboard listings. Given these factors, this offering may be better suited for well-informed investors who have a higher risk appetite and are looking for medium-term investment horizons. It is always recommended to conduct your own due diligence and consider consulting with a financial advisor.

Getting Started: How to Apply for an IPO

Applying for an IPO is generally a straightforward process. You can apply online through either the UPI (Unified Payments Interface) or ASBA (Applications Supported by Blocked Amount) payment methods.

• Using UPI: If you have a trading account with a broker who supports UPI IPO applications, you can apply directly through their platform. You'll typically enter your UPI ID, quantity, and price, then approve the mandate via your UPI app (e.g., BHIM, Google Pay, PhonePe).
• Using ASBA: This method is available through the net banking portal of your bank account. Log in to your bank's net banking, find the 'IPO' or 'e-ASBA' section, select the IPO you wish to apply for, enter your bid details, and submit. The amount will be blocked in your account until allotment.

Key IPO Questions Answered

Here are answers to some common questions regarding the Prime Cable Industries IPO:

• What is the Prime Cable Industries IPO?
  It is a SME IPO of 48,20,800 equity shares of face value ₹5, aggregating up to ₹40.01 Crores. The issue has a price band of ₹78 to ₹83 per share, and the minimum order quantity is 1600 shares.
• When does the IPO open and close?
  The IPO opens on Monday, September 22, 2025, and closes on Wednesday, September 24, 2025.
• What is the lot size of Prime Cable Industries IPO?
  The IPO lot size is 1,600 shares, requiring a minimum investment of ₹2,65,600 for retail investors (at the upper price band).
• How can one apply for this IPO?
  You can apply online using either UPI or ASBA as a payment method through your broker's platform or your bank's net banking portal, respectively.
• When is the allotment expected?
  The finalization of the Basis of Allotment is tentatively scheduled for Thursday, September 25, 2025.
• What is the tentative listing date?
  The tentative date for listing on NSE SME is Monday, September 29, 2025.

Conclusion

The Prime Cable Industries IPO presents an opportunity to invest in a company with a strong foundation in the cable manufacturing sector, supported by robust recent financial growth and strategic expansion plans. However, like all investments, it comes with its own set of risks, including market competition and valuation considerations. A thorough understanding of the company's fundamentals, financials, and the broader industry landscape is crucial for making an informed investment decision. Remember, thoughtful research and a clear understanding of your personal financial goals are your best tools in navigating the exciting world of IPOs.