DCG Wires And Cables Limited IPO

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DCG Cables and Wires Ltd. stands as a distinguished manufacturer in the copper cables and wires industry, catering primarily to transformer manufacturers. With a rich product portfolio encompassing Copper Strips, Paper Covered Copper Strips, and Wires in various insulations, Bare Copper Wires and Strips, Copper Tapes, and Fiber Glass Copper among others, DCG is committed to delivering excellence in conductivity and durability for various applications.

Strategic Manufacturing Capacity: Their operations are anchored in three state-of-the-art manufacturing units located in Odhav, Kubadthal (Ahmedabad), and Waghodia (Vadodara), Gujarat. With an impressive combined installed capacity, they specialize in manufacturing a wide array of copper products, fulfilling the industry’s stringent quality and performance standards. In line with their growth strategy, they are in the process of setting up a new, advanced manufacturing plant in Bhayala, Bavla, Gujarat, to further enhance our production capabilities and operational efficiency.

Quality and Accreditation: Adherence to quality is paramount at DCG, evidenced by their ISO 9001: 2015 Certification for Quality Management System. Their commitment to maintaining the highest standards of quality and innovation is unwavering, ensuring they meet their clients’ specific requirements with precision and reliability.

Market Presence and Strategy: Their market strategy revolves around fostering and sustaining robust relationships with their clients. Primarily serving the transformer manufacturing sector, they have established a significant presence in Gujarat, which accounts for the majority of their sales. Expanding their horizons, they have recently ventured into the Maharashtra and Karnataka markets, marking a strategic move towards nationwide coverage.

Future Outlook: As they continue to expand and innovate, DCG Cables and Wires Ltd. is poised for a future of sustained growth and leadership in the copper products manufacturing industry. Their focus on quality, customer relationships, and strategic expansion underpins their commitment to excellence and industry leadership.

Objects of the DCG Wires And Cables Limited IPO:

The company proposes to utilize the Net Proceeds from the issue towards the following objects: i. Capital Expenditure for building construction, ii. Working capital requirement, iii. General Corporate Purpose, and iv. Meeting Public Issue Expenses.
DRHP of DCG Wires And Cables Limited IPO
RHP of DCG Wires And Cables Limited IPO

DCG Wires And Cables Limited IPO Details:

Open Date: Apr 08 2024
Close Date: Apr 10 2024
Total Shares: 4,999,200
Face Value: ₹ 10 Per Equity Share
Issue Size: 49.99 Cr.
Lot Size: 1200 Shares
Issue Price: ₹ 100 Per Equity Share
Listing At: NSE Emerge
Listing Date: Apr 15 2024

Promoters And Management:

Mr. Devangbhai Patel aged 33 years, is Promoter and Managing Director of the Company. He has completed his HSC examination in the year 2005. In his young age he has gained the experience of more than decade in the field of copper, cable, and wire industry. He is the one of the pioneer and promoter of the Company. Because of his hard work and dedication towards the Company, The Company is able to achieve all the milestones as per stated in the “History and Certain Corporate Matters” on page no. 101 of the Prospectus. He is presently in charge of finance, macro management, and strategic matters for the company. He is a first-generation entrepreneur and has led the company in undertaking various projects. He is the key managerial person and the backbone behind the expansion of the business. Mr. Harshadbhai Patel aged 71 years, is Promoter and Non-Executive Director of the Company. He has completed his Diploma in Automobile Engineering from Technical Examination Board, Gujarat State in the year 1973. He is the one of the pioneer and promoter of the Company. He possess more than two decades of vast experience in copper industry. He provides his professional guidance and expertise for furtherance of business of the company. Mrs. Ushaben Patel aged 66 years, is Promoter and Non-Executive Director of the Company. She has completed her SSC Examination in the year 1975 from Gujarat Secondary school Certificate Examination Board, Baroda. She is the one of the pioneer and promoter of the Company and before she has been appointed as Director, she has not worked in any other organization. Currently, she evaluates the performance of the management team in terms of meeting goals and objectives. She is also responsible for objectively looking at the plans framed by the executive team.

Financials of DCG Wires And Cables Limited IPO:

Particulars ( In Lakhs )
2021
2022
2023
11M-FY24
Revenue from Operations 1,462 2,769 5,452 7,633
Other Income 1 1 3 6
Total Revenue 1,463 2,770 5,455 7,639
Cost of materials consumed 1,438 2,926 5,095 6,687
Changes in Inventories -18 -345 -147 -763
Employees Benefit Expenses 23 70 75 110
Other Expenses 4 27 78 115
EBITDA 16 92 355 1,491
Depreciation & Amortisation 1 9 28 92
Finance Cost 1 33 98 267
EBIT 15 83 328 1,399
OPM (%) 1.08% 3.31% 6.51% 19.52%
PBT 14 50 230 1132
Tax 3 12 58 285
PAT 10 37 172 847
NPM (%) 0.70% 1.34% 3.15% 11.09%
No.of Shares 181.49 181.49 181.49 181.49
EPS 0.05 0.20 0.94 4.66

Comparison With Peers:

Name of the Company Revenue (In Crore) PAT (In Crore) EPS ( in Rs) P/E CMP Mcap (In Crore)
DCG Cables and Wires Limited 55 2 0.94 105.5 100 181
Cords Cable Industries Limited 526 7 5.58 26.4 183 237
Universal Cables Limited 2,202 118 34.05 16.3 474 1,643
* All the data is as per FY23.

Recommendation on DCG Wires And Cables Limited IPO:

Review and Recommendation of DCG Wires And Cables by team IZ is 4/10. 1. DCG Cables and Wires Ltd. is a pivotal player in the manufacturing domain of copper-based products, particularly catering to the needs of the transformer manufacturing industry. With a rich product portfolio that includes bare copper wires and strips, paper-covered conductors, fiber glass-covered copper strips, and a variety of specialized cables, the company stands out for its commitment to quality, customization, and reliability. 2. SWOT Analysis Strengths Exceptional Product Quality: The cornerstone of your competitive advantage, ensuring customer trust and market demand. Customization Expertise: Catering to specific customer needs, thereby enhancing client satisfaction and loyalty. Competitive Pricing: Achieved through efficient supply chain management, allowing you to offer value to your clients. Experienced Promoters: Providing strategic vision and operational excellence, fostering growth and resilience. Weaknesses Limited Product Diversification: Suggests potential areas for broadening your product range to mitigate market risks. Supplier Dependency: Highlights the need for diversifying supply sources to enhance supply chain robustness. Market Dependency: Indicates the importance of exploring new market segments or geographies for business stability. Opportunities Emerging Markets: Represents avenues for geographic and market segment expansion. Digital Transformation: Offers potential for operational efficiencies, customer engagement, and service innovation. Infrastructure Investment: Signals the growing demand for cables and wires in national development projects, positioning DCG as a key industry partner. Threats Economic Uncertainty: Requires strategic planning to navigate market volatilities. Supply Chain Disruptions: Underscores the importance of a resilient and adaptable supply chain strategy. Intense Competition: Necessitates continuous innovation and differentiation to maintain and grow market share. 3. Competitive Landscape The cables and wires industry's competitive nature demands a strategic focus on product quality, innovation, customer service, and cost-effectiveness. DCG's dedicated account management and customer-centric approach, coupled with its competitive pricing and quality, provide a solid foundation to compete effectively. However, the presence of significant competitors like Elite Conductor Ltd., Vidhya Wires Pvt. Ltd., and others, calls for ongoing efforts in innovation, market expansion, and operational efficiency to sustain and enhance market positioning. 4. Strategic Considerations To leverage its strengths and address the identified weaknesses and threats, DCG should consider: Diversifying its product portfolio to include new and innovative solutions that cater to emerging market needs. Expanding into new markets, both domestically and internationally, to reduce dependency on specific sectors. Investing in digital transformation to streamline operations, improve customer interactions, and enhance supply chain resilience. Enhancing supplier relationships and developing alternative sourcing strategies to mitigate supply chain risks. 5. The Revenue has Increased from Rs.14 Crores in FY21 to Rs.54 Crores in FY23. 6. The EBITDA has Increased from 16 Lakhs in FY21 to 3 Crores in FY23. 7. The PAT has Increased from 10 Lakhs in FY21 to 1.7 Crores in FY23. 8. As per FY23, CFO/EBITDA is 0.98, As per FY24, EPS is 5.09, 9. Market Capitalization is 181 Crore & P/E is 19.63x based on FY24.

Lead Manager of DCG Wires And Cables Limited IPO:

  1. Interactive Financial Services

Registrar of DCG Wires And Cables Limited IPO:

  1. Bigshare Services Private Limited

Company Address:

DCG Wires And Cables Limited 12, Agrasen Industrial Estate, Chotalal Ni Chali, Odhav Road, Ahmedabad -382415 Phone: +91 7861804932 Email: dcgcopperindustries@yahoo.com Website: http://www.dcgcableswiresltd.com/

Discussion on DCG Wires And Cables Limited IPO:

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