Decoding the Borana Weaves Ltd IPO: An In-Depth Analysis
The primary market is buzzing with activity, and Borana Weaves Ltd is set to launch its IPO, offering a chance to invest in a Surat-based textile manufacturer. This blog post dives into the details of the IPO, providing a comprehensive analysis to help you make an informed decision.
Borana Weaves: Weaving the Fabric of Innovation
Borana Weaves Limited specializes in manufacturing unbleached synthetic grey fabric, essential for fashion, home decor, and industrial applications. They also produce polyester textured yarn (PTY), a vital component in grey fabric production. With three advanced manufacturing units in Surat, Gujarat, the company operates 700 water jet looms and maintains a comprehensive setup for texturizing, warping, and fabric finishing.
Key IPO Details
- Status: Upcoming
- Open Date: May 20, 2025
- Close Date: May 22, 2025
- Listing Date: May 27, 2025
- IPO Price Range: ₹205 to ₹216 per share
- IPO Size: ₹144.89 Cr
- Listing Exchange: BSE NSE
IPO Timeline
Bidding Starts
Bidding Ends
Allotment Finalisation
Refund Initiation/Demat Transfer
Listing
Investment Details
- Minimum Investment: ₹14,145 (69 shares)
Lot Size Details
| Category | Lots | Shares | Amount (₹) |
|---|---|---|---|
| Retail (Min) | 1 | 69 | 14,145 |
| Retail (Max) | 13 | 897 | 183,885 |
| S-HNI (Min) | 14 | 966 | 198,030 |
| S-HNI (Max) | 67 | 4,623 | 947,715 |
| B-HNI (Min) | 68 | 4,692 | 961,860 |
Company Valuation
- Established: 2020
- Chairman & MD: Mr. Mangilal Ambalal Borana
- Peers: Jindal Worldwide Ltd., Vardhman Textiles Ltd., Arvind Ltd., KPR Mill Ltd., Gokaldas Exports Ltd., Shahlon Group Ltd.
Financial Performance
Analyzing the financial health of a company is crucial before investing. Here's a snapshot of Borana Weaves' financial performance:
Profit and Loss Statement
| Particulars (₹ in Crores) | FY22 | FY23 | FY24 |
|---|---|---|---|
| Revenue | 42.36 | 135.53 | 199.60 |
| EBITDA | 5.17 | 26.06 | 41.17 |
| PAT | 1.80 | 16.30 | 23.59 |
Balance Sheet
| Particulars (₹ in Crores) | FY22 | FY23 | FY24 |
|---|---|---|---|
| Total Assets | 31.90 | 74.98 | 137.90 |
| Share Capital | 0.01 | 0.04 | 0.04 |
| Total Borrowings | 27.31 | 38.89 | 69.10 |
Cash Flow Statement
| Particulars (₹ in Crores) | FY22 | FY23 | FY24 |
|---|---|---|---|
| Net Cash Generated From / (used in) operating activities | -8.33 | 6.90 | 22.13 |
| Net Cash Generated From / (used in) investing activities | -16.37 | -22.10 | -48.07 |
| Net Cash Generated From / (used in) financing activities | 24.70 | 15.28 | 25.87 |
| Net Increase (Decrease) In Cash And Cash Equivalents | 0.01 | 0.07 | -0.08 |
Objectives of the IPO
The company plans to utilize the funds raised through the IPO for:
- Setting up a new grey fabric manufacturing unit in Surat, Gujarat
- Meeting additional working capital needs
- General corporate purposes
SWOT Analysis
A SWOT analysis helps in understanding the internal strengths and weaknesses, as well as external opportunities and threats facing the company.
Strengths
- Advanced water jet looms enhance efficiency and fabric quality
- Focused grey fabric line targets niche textile segment
- Strong reputation for quality and customer reliability
- Vertical integration streamlines supply chain and reduces delays
Weaknesses
- High-tech machinery increases fixed and operational costs
- Entire revenue depends on the domestic market
- Heavy reliance on regular technology upgrades
- Limited product diversification increases market concentration risk
Opportunities
- Rising demand for sustainable and eco-friendly textiles
- Potential to tap high-demand global textile markets
- Growing domestic market for specialized grey fabric
- Export incentives can boost international competitiveness
Threats and Challenges
- Intense competition from local and global textile manufacturers
- Raw material price volatility affects profit margins
- Regulatory shifts may raise compliance and labor costs
- Economic slowdowns can hurt textile demand and revenue
Reasons to Consider Investing
- The company has shown strong financial growth, with revenue rising significantly from FY22 to FY24.
- It operates in a niche market, focusing on grey fabric and PTY yarn used across multiple textile applications.
- Borana Weaves stands to benefit from India’s fast-growing textile industry, projected to reach US$ 350 billion by 2030.
- IPO proceeds will support a new manufacturing unit in Surat, boosting production capacity and operational scale.
Industry Prospects
- India’s textile and apparel market is expected to grow at 10% CAGR, reaching US$ 350 billion by 2030.
- The country ranks as the 3rd largest global textile exporter, with exports projected to hit US$ 100 billion.
- The sector contributes 2.3% to GDP, with potential to double its share by the decade's end.
- India’s home textile market is set to grow at 8.9% CAGR, reaching US$ 23.32 billion by 2032.
Key Company Contacts
- Company: Borana Weaves Limited
- Address: Plot No AA/34, B 16/16, Hojiwala Industrial Estate, SUSML, Sachin
- Phone: +91-9898426338
- Email: info@boranagroup.in
- Website: https://www.boranagroup.in/
Registrar Information
- Registrar: Kfin Technologies Limited
- Phone: 04067162222, 04079611000
- Email: bwl.ipo@kfintech.com
- Website: https://kosmic.kfintech.com/ipostatus/
Lead Manager
- Lead Manager: Beeline Capital Advisors Pvt Ltd
Conclusion
The Borana Weaves IPO presents an opportunity to invest in a growing textile manufacturer with a niche focus. With strong financial growth, strategic objectives, and a promising industry landscape, the IPO could be an attractive option. However, potential investors should carefully consider the company's strengths, weaknesses, opportunities, and threats before making a decision. Always conduct thorough research and consider seeking advice from a financial advisor to align your investment with your financial goals and risk tolerance.
Disclaimer: This blog post is for informational purposes only and does not constitute financial advice. Investing in IPOs involves risk, and it is essential to conduct thorough research before making any investment decisions.