Should you buy, sell or hold?“Investors or traders who have received an allocation may consider holding the stock for the medium to long term, especially if the company performs well in terms of capacity utilization and margin improvement. Those looking for risk management can keep a stop-loss near Rs 45 while keeping an eye on quarterly performance for clues to future growth,” said Shivani Nyati of Swastika Investmart.
She added that the company’s strengths include a diversified product portfolio including enameled copper wires, strong relationships with industrial customers and a growing presence in sectors such as electricity, automotive parts and consumer durables. Manufacturing capabilities, years of industry experience and consistent revenue growth supported solid subscription numbers during the IPO.
Analysts say growing investments in the energy sector are increasing demand for electrical wires and cables. The government’s focus on energy security, renewables and access to electricity in rural areas has led to a sharp increase in the number of power generation, transmission and distribution projects, necessitating a robust electrical infrastructure.
“Vidya Wires is strategically positioned to capitalize on this growing demand. As one of India’s leading manufacturers of winding and conductivity products, the company’s diverse product range and strong industry relationships place it well-positioned to capitalize on the growing wire and cable market. Investors can view the IPO as a potential long-term investment opportunity,” Master Capital Services said. Vidya Wires’ valuation seems compelling. Based on FY25 diluted earnings per share, the IPO is priced at a price-to-earnings ratio of 20.39x at the high end of the price range and 18.82x at the low end.
This makes the offering significantly cheaper than the industry’s average price-to-earnings ratio of 47.82x for the same period. The company has also demonstrated stable profitability, reflected in its three-year weighted average return on equity of 22.69%.
The company’s financial performance remains strong, with an operating revenue of Rs 1,295 crore in FY25. The power and transmission segment contributed 48.06% of this revenue, followed by 28.58% from the power sector and 10.20% from general engineering, underscoring a well-diversified and resilient business model.
(Disclaimer: Recommendations, suggestions, views and opinions expressed by the experts are their own. These do not represent the views of The Economic Times)
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