Cable Solutions IPO presents attractive entry point for investors seeking growth
Sri Lanka’s only integrated cable manufacturer and subsidiary of the ACL Group, Cable Solutions Limited (CSLK), said that they are rapidly expanding the export market and will invest USD 500,000 to set up a factory in Chennai India.
CEO/Managing Director of CSLK Pawan Tejwani, said that they started exporting to India utilising the FTA and today out of their total exports 27% are to India. “This is why we plan to set up a factory in India. Our other export markets include the USA, UK, Spain, Italy, Germany, Sweden, Switzerland, Russia, Australia, and New Zealand.”
“In FY 2023, our revenues exceeded LKR 3.3 billion. CSLK currently exports to 13 countries, with export revenue accounting for 94% of our total revenue. We have diversified our presence across multiple industries including, load cells, automotive, electronic vehicle, instrumentation cables and renewable energy.”
The company also announced its plans for its Initial Public Offering (IPO) on July 23 and subsequent listing on the Diri Savi Board of the Colombo Stock Exchange.”
“The IPO will consist of a total of 80,786,600 ordinary voting shares of the company offered to the public, through a combination of an offer for subscription of 14,666,600 new ordinary voting shares and an offer for sale of 66,120,000 existing ordinary voting shares.”
The offer price for CSLK shares is set at LKR 7.50 per share. The company aims to raise a total of LKR 109,999,500 from the public through a subscription offer for 14,666,600 shares.
The primary purpose of this fundraising effort is to allocate 81.8% of the proceeds towards capital expenditures for new machinery and production line upgrades, aimed at enhancing production efficiency. 18.2% of the funds will be utilised to enhance the working capital position. Through the offer for sale, a few existing shareholders plan to sell a combined total of 66,120,000 ordinary voting shares in CSLK. “We will also use around Rs. 90 million for a new machine which will increase the cable manufacturing facility by four times.”
In December 2019, a consortium of investors structured by Tempest PE Partners and led by ACL Cables PLC acquired a 75% stake in CSLK and due to this the company scaled up rapidly. Managing Director of ACL, Suren Madanayake, disclosed plans to invest in automation via and also move towards the EV side of the business.” (SS)
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