Polycab Sells 2.74% Stake for ₹2,716 Crore in Block Deal

On Friday, June 28, a 2.74% equity stake in Polycab India was sold through block deals for ₹2,716.5 crore. The identities of the buyers or sellers were not immediately disclosed, but CNBC TV18 had earlier reported that the promoters were looking to sell part of their stake.

On Friday, shares of Polycab India Ltd. opened 4.3% lower following a significant trade in the wires and cables manufacturer.

According to CNBC TV18, the block deal involved 40.5 lakh shares of Polycab India being traded at ₹6,708 per share, reflecting a 4% discount from the previous close. On Thursday, June 27, Polycab India shares had declined by 2.5%, closing at ₹6,998.6.

Over the past year, Polycab India stock has nearly doubled in value and has surged over 28% year-to-date, significantly outperforming the NSE Nifty 50 in both periods. According to the latest quarterly update filed with the stock exchanges, the promoter group of Polycab India held a 65.24% stake in the company.

In the last fiscal quarter from January to March, Polycab India reported a 29% year-on-year increase in consolidated net profit, reaching ₹553 crore compared to ₹428 crore in the same period the previous year. The company's revenue from operations also saw a 29% year-on-year rise, totaling ₹5,592 crore in Q4 FY24, up from ₹4,324 crore in the corresponding period of the previous year.

Both the company's topline and bottomline exceeded CNBC-TV18's estimates, which were ₹4,979 crore for revenue and ₹480 crore for net profit. Operating profitability increased by 10% to ₹762 crore, surpassing CNBC-TV18's estimate of ₹693 crore. However, operating margins decreased by 30 basis points to 13.6%, slightly below the estimated 13.9%. 

Earlier this week, sources informed CNBC-TV18 that the offer price range for this transaction was set between ₹6,535 and ₹6,989.25 per share, representing a discount of up to 6.5% on the current market price (CMP). At the lower end of the price band, the offer size was estimated to be ₹2,005.9 crore.

Additionally, there will be a 90-day lock-in period during which the promoters are restricted from selling any further shares, according to sources close to the development.