Sanathan Textiles Limited IPO (Sanathan Textiles IPO) Detail Review –
Sanathan Textiles Limited IPO (Sanathan Textiles IPO) is set to open for subscription from 19th Dec 2024 to 23rd Dec 2024. In this article we will analyze the financials , strengths and weaknesses of the Sanathan Textiles Limited IPO (Sanathan Textiles IPO). Keep scrolling below to read more!
Sanathan Textiles Limited IPO (Sanathan Textiles IPO) Overview –
Established in 2005, Sanathan Textiles Limited is a polyester yarn manufacturer and a global supplier of Cotton Yarn. The company’s business is divided into three separate yarn business verticals, consisting of: (a) Polyester yarn products; (b) Cotton yarn products; and (c) Yarns for technical textiles and industrial uses. These technical textiles are used in various sectors such as automotive, healthcare, construction, sports and outdoor activities, and protective clothing.
As of September 30, 2024, the company had more than 3,200 active varieties of yarn products (i.e., yarn products manufactured from April 1, 2021, to September 30, 2024) and more than 45,000 stock-keeping units (SKUs). It also can manufacture a diversified product portfolio of more than 14,000 varieties of yarn products and more than 190,000 SKUs that are used in various forms and for varied end uses.
As of June 30, 2024, Fiscal 2024, and Fiscal 2023, Sanathan Textiles Limited exported its products to 14, 27 and 29 countries.
As of June 30, 2024, the company had more than 925 distributors in 7 countries, including India, Argentina, Singapore, Germany, Greece, Canada, and Israel.
The company’s manufacturing unit is located in Silvassa. The company’s clients comprise several multinational, regional and local companies such as Welspun India Limited, Valson Industries Limited, G.M. Fabrics Private Limited, Premco Global Limited, Creative Garments Textile Mills Private Limited, Banswara Syntex Limited, AYM Syntex Limited, Techno Sportswear Private Limited, Haren Textiles Private Limited, Khosla Profil Private Limited, Tulip Elastics Private Limited and more.
Company Strengths:
- The company is one of the few companies (amongst their peer group) in India with a presence across the polyester, cotton and technical textile sectors.
- Focus on the product development of new products, through process innovation.
- Fully integrated Yarn manufacturing plant set up at a strategic location with equipment supplied by domestic and globally renowned players.
- Long-standing association with leading consumer brands with a low customer concentration.
- Deep knowledge and understanding of optimal product assortment and strong supplier network enabling procurement at predictable and competitive pricing, leading to an overall efficient cycle.
- Healthy financial performance
- Experienced management team with a proven track record
- Our Strategies Expanding our manufacturing capacity.
- Enhance value addition in existing products and development of new products.
- Harnessing digitization and technology in production processes with a focus on energy efficiency and sustainable practices.
- Cotton yarn manufacturing process
- Yarns for technical textiles and industrial end-use
Sanathan Textiles Limited IPO (Sanathan Textiles IPO) Synopsis –
Sanathan Textiles Limited IPO (Sanathan Textiles IPO) is set to be open for subscription from 19th Dec 2024 to 23rd Dec 2024, offering combination of fresh issue of 1.25 crore shares aggregating to Rs 400.00 crores and offer for sale of 0.47crore shares aggregating to Rs 150.00 crores. This NSE,BSE IPO follows a Book Built Issue IPO with tentative listing date fixed as Friday, December 27, 2024.
The total issue size of this IPO amounts to Rs. 550.00 Crores. The company has allocated shares 35% to retail investors, 50% to institutional and 15% to non institutional investors.
| Particulars | Details |
| Opening Date | 19th Dec 2024 |
| Closing Date | 23rd Dec 2024 |
| Lot Size | 46 Shares |
| Face Value | Rs 10 |
| IPO Size | Rs. 550.00 Cr |
| Fresh Issue | Rs. 400.00 Cr |
| IPO Price Range | Rs. 305 – 321 |
| Min. Investment | Rs. 14,766 |
| Offer for Sale (OFS) | Rs. 150.00 Cr |
| Employee Discount | — |
| Basis of Allotment | 24th Dec 2024 |
| Refunds | 26th Dec 2024 |
| Listing Date | 27th Dec 2024 |
| DRHP Draft Prospectus: | Click Here |
| RHP Draft Prospectus: | Click Here |
Sanathan Textiles Limited IPO (Sanathan Textiles IPO) Market Lot –
Sanathan Textiles Limited IPO (Sanathan Textiles IPO) minimum market lot is 46 shares with ₹14,766 application amount. The retail investors can apply up to 13 lots with 598 shares or ₹1,91,958 amount.
| Application | Lot Size | Shares | Amount |
| Retail Minimum | 1 | 46 | ₹14,766 |
| Retail Maximum | 13 | 598 | ₹1,91,958 |
| S-HNI Minimum | 14 | 644 | ₹2,06,724 |
| S-HNI Maximum | 67 | 3,082 | ₹9,89,322 |
| B-HNI Minimum | 68 | 3,128 | ₹10,04,088 |
Sanathan Textiles Limited IPO (Sanathan Textiles IPO) Book Running Lead Managers –
- DAM Capital Advisors Limited
Sanathan Textiles Limited IPO (Sanathan Textiles IPO) Promoters –
Nimbus Trust
D&G Family Trust
A&J Family Trust
P&B Family Trust
Paresh Vrajlal Dattani
Ajay Vallabhdas Dattani
Anilkumar Vrajdas Dattani
Dinesh Vrajdas Dattani.
Pre-Issue Promoter Shareholding | 100% |
Post-Issue Promoter Shareholding | – |
Sanathan Textiles Limited IPO (Sanathan Textiles IPO) Registrar to the offer –
The registrar for the Sanathan Textiles Limited IPO (Sanathan Textiles IPO) is Kfin Technologies Limited. They are responsible for ensuring the IPO allotment and refund processes are carried out smoothly.
The Objective Of The Issue –
The company desires to use the Net Proceeds from the Issue to fulfill its following goals:
- Repayment and/ or pre-payment, in full or part, of certain borrowings availed by the Company;
- Investment in our subsidiary viz. Sanathan Polycot Private Limited, for repayment and/ or pre-payment, in full or part, of certain borrowings availed by our subsidiary viz. Sanathan Polycot Private Limited; and
- General corporate purposes.
Key Performance Indicator –
The market capitalization of Sanathan Textiles Limited IPO is Rs 2,709.37 Cr.
KPI as of March 31, 2024.
| KPI | Values |
| ROE: | 11.09% |
| ROCE: | 11.80% |
| EBITDA Margin: | 7.66% |
| PAT Margin: | — |
| Debt to equity ratio: | 0.30 |
| Earning Per Share (EPS): | ₹18.60 (Basic) |
| Price/Earning P/E Ratio: | N/A |
| Return on Net Worth (RoNW): | 10.42% |
| Net Asset Value (NAV): | ₹177.22 |
Financial Status –
Sanathan Textiles Limited’s revenue decreased by -11% and profit after tax (PAT) dropped by -12% between the financial year ending with March 31, 2024 and March 31, 2023.
Below is the synopsis of the company’s financial data for the financial year that concluded on 30 June 2024.
The company’s total assets are Rs. 2,529.53 crore.
The company’s total revenue is Rs. 787.76 crore.
The company’s PAT is Rs. 50.07 crore.
The company’s net worth is Rs. 1,324.06 crore
| Period Ended | 30 June 2024 | 31 Mar 2024 | 31 Mar 2023 | 31 Mar 2022 | ||||||||||||||||||||||||||||||||||||
| Total Assets | 2,529.53 | 2,203.68 | 1,906.67 | 1,796.47 | ||||||||||||||||||||||||||||||||||||
| Revenue from operations | 787.76 | 2,979.8 | 3,345.02 | 3,201.46 | ||||||||||||||||||||||||||||||||||||
| Profit After Tax | 50.07 | 133.85 | 152.74 | 355.74 | ||||||||||||||||||||||||||||||||||||
| Net Worth | 1,324.06 | 1,273.98 | 1,140.13 | 987.39 | ||||||||||||||||||||||||||||||||||||
| Reserves and Surplus | – | – | – | – | ||||||||||||||||||||||||||||||||||||
| Total Borrowing | 644.93 | 379.88 | 281 | 20.86 | ||||||||||||||||||||||||||||||||||||
| Amount in ₹ Crore | ||||||||||||||||||||||||||||||||||||||||
Evaluation of P/E Ratio :
Considering the FY ended 31 Mar 2024 with an EPS of Rs.18.60 from the last year, the resulting P/E ratio is 17.25x.
Considering the weighted EPS of Rs.24.61 for the last three years, the P/E ratio is 13.04x.
Comparative Analysis with Listed Peers
The average P/E Ratio of the industry is 29.50x.
In simple words, the P/E ratio of this IPO (17.25x), compared with the industry’s average P/E of 29.50x, has an undervaluation (on a P/E ratio basis only). Hence the price of the Share seems fully priced for the investors when considered based on the average P/E ratio of the industry.
Peers of Sanathan Textiles Limited IPO (Sanathan Textiles IPO) –
Sanathan Textiles Limited peer comparison with similar listed entities. (As on March 28, 2024)
| Company | EPS | PE Ratio | RoNW % | NAV | Income |
| K.P.R. Mill Ltd | 23.56 | 40.18 | 18.48 | 127.50 | 6,059.68 Cr. |
| Vardhman Textiles Ltd. | 22.20 | 23.34 | 7.00 | 314.69 | 9,504.68 Cr. |
| Indo Count Industries Ltd | 17.06 | 22.49 | 16.35 | 105.48 | 3,557.07 Cr. |
| Filatex India Ltd | 2.49 | 25.00 | 9.19 | 27.13 | 4,285.90 Cr. |
| Garware Technical Fibres Ltd. | 102.16 | 35.38 | 16.87 | 621.49 | 1,325.61 Cr. |
Dividend Policy –
The company has not declared dividends in the last three FYs.
Sanathan Textiles Limited IPO (Sanathan Textiles IPO) Strengths –
Presence in most of the polyester, cotton, and technical textile segments in India’s peer group of companies.
Mainly engaged in creating new products through process innovation.
The yarn manufacturing facility is well integrated at a strategic place, equipped by domestic players and globally renowned suppliers.
A long history of association with major consumer brands having low customer concentration.
High knowledge and understanding of optimal product assortment and a strong supplier network that enable procurement at predictable and competitive prices, leading to an overall efficient cycle.
Sanathan Textiles Limited IPO (Sanathan Textiles IPO) Weakness –
Market Risk: This being the initial public offering of the company, there has not been any established market for shares or equity in the company. It causes uncertainty for active or sustained trading in the shares post-listing.
Liquidity Risk: Investors face some degree of liquidity risk. There is neither a liquidation guarantee nor a successful one at various future price levels at which the shares might trade.
Regulatory Risk: An IPO is subject to very strict compliance with SEBI regulations. Therefore, any change in regulatory policies can affect trading and investment results.
Business Risk: The performance of the company will depend on operational, market, and financial uncertainties that hit investment values directly.
Investment Risk: This carries with it all the equity investment risks and the corresponding high probability of losing up to the last penny invested. Investors should understand all risk factors associated with their investments.
Sanathan Textiles Limited IPO (Sanathan Textiles IPO) Status –
Sanathan Textiles Limited IPO (Sanathan Textiles IPO) allotment status will be available on the Kfin Technologies Limited website. Click on this link to get allotment status.
Disclaimer –
- Don’t decide to subscribe to an IPO just based on the initial price, as it can change before the listing. Subscribe only after considering fundamentals of the companies.
Conclusion –
Hope the details presented in this blog will assist you in learning about the financial performance of the company. Before making an investment in the company’s upcoming initial public offering (IPO), thoroughly research the company, its finances, business prospects, and market trends.
Also, investors should consult their financial advisor, conduct further due diligence, analyze industry trends and the competitive landscape, and consider risk factors before making an investment decision.
For all such latest information on upcoming IPOs, keep visiting our website.
