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Polycab India - Reviews
« on: April 05, 2019, 12:38:28 PM »
Here are the Equity Research Analysts Recommendations of Polycab India IPO / Public Issue

ICICI Direct Analysts Sanjay Manyal & Hitesh Taunk said

At the IPO price band of | 533-538, the stock is available at a price to earnings multiple of 22x FY18 EPS. We believe the issue is available at attractive valuation, considering its leadership position in the wire & cable industry, low debt/equity (~0.3x) and attractive return ratios (RoCE ~21%, RoE ~16%). We recommend SUBSCRIBE to the issue at the offer price.

Motilal Oswal Analysts Siddarth Khemka and Pooja Doshi said,

At the upper price band, Polycab is valued at 16.8x P/E on FY19 annualized basis, compared to KEI Industries 18.4x P/E (MOSL estimates) and Finolex Cables 17.2x P/E FY19E (Bloomberg estimates). Given the strong industry growth trends, leadership position, healthy financials and comfortable valuations, we are positive on the IPO. Hence recommend SUBSCRIBE.

Gupta Equities Ltd released the following note,

Polycab India Ltd stands to gain from operating leverage. At a P/E at lower band of 25X* and P/E at higher band of 25.3X* for FY19 EPS. We believe its strategy of making market presence more prominent in wires and cables sector and investment in technology will improve operating efficiency. We assign a Subscribe rating to the IPO.

ShareKhan Released the following note to us,

Polycab has a strong growth profile with revenue, operating profit and net profit reporting a CAGR of  10%, 23% and 42%, respectively, during FY2016-FY2018. Further, it has low net debt/equity of 0.2x as on December 2019. At the upper price band, Polycab is valued at a P/E of 21.6x its FY2018 earnings which is much lower than the industry average but almost at par with close peers like KEI Industries and Finolex cables. However its RoE is tad lower than industry players barring Finolex cables.

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Re: Polycab India - Reviews
« Reply #1 on: April 05, 2019, 12:39:07 PM »
Reliance Securities Analyst Araft Saiyed said,

Wires and cables industry is expected to see sustained demand driven by multiple favourable factors, and we expect growth momentum to
sustain, going ahead as well. Assuming moderate revenue growth of 12% CAGR through FY19-21E, the Company is valued at 11.3x FY21E earnings, which appears to be justified considering its business model, steady growth and healthy return ratios. Hence, we recommend SUBSCRIBE to the Issue.