Spunweb Nonwoven IPO: Your Gateway to the Fabric of Future Growth?
The Indian primary market is buzzing with activity, and a new opportunity is on the horizon for investors interested in the industrial textiles sector. Spunweb Nonwoven Limited, a prominent manufacturer in the non-woven fabric space, is gearing up for its Initial Public Offering (IPO) on the SME platform of NSE. This upcoming public issue invites investors to become a part of a company that is foundational to various industries, from hygiene to healthcare. Let's delve into the details to understand if this offering aligns with your investment goals.
Unveiling Spunweb Nonwoven Limited
Established in 2015, Spunweb Nonwoven Limited has carved a niche as a significant manufacturer and supplier of non-woven fabrics. These versatile materials find extensive use in products such as doormats, bags, carpets, and tarpaulins. The company's commitment to quality is evident through its robust quality control system, which incorporates meticulous testing, inspection, and analysis to ensure superior product output.
What the Company Does: A Fabric of Innovation
Spunweb Nonwoven is at the forefront of manufacturing diverse nonwoven fabrics, including laminated and UV-treated variants. Their state-of-the-art testing facilities, equipped for Universal Tensile Testing and Rewet Properties Testing, underscore their dedication to product excellence. A significant portion of their revenue, over two-thirds, originates from the hygiene sector's demand for fabric, with the remainder stemming from applications in the medical, packaging, agriculture, and construction industries. The company proudly exports its products to major global markets including North America, Europe, and the Middle East, serving a wide array of clients. Their manufacturing hub is strategically located in Rajkot, Gujarat.
Their product portfolio includes Hydrophobic Fabric, Hydrophilic Fabric, and UV-Treated Fabric, catering to specialized industrial needs.
Core Strengths: Weaving a Strong Foundation
- Recognized as one of the largest manufacturers of spunbond nonwoven fabrics within India.
- Capability for tailored spunbond nonwoven fabric manufacturing, precisely meeting industry-specific requirements.
- Established long-standing relationships with a diverse clientele across various industries and geographical regions.
- Utilizes advanced spunbond technology coupled with cleanroom technology, ensuring a high standard for its manufacturing processes.
- Driven by experienced promoters and a robust management and execution team, guiding the company's strategic direction.
Navigating the Public Offering – Key Details
The Spunweb Nonwoven IPO is set to be a book-building issue, aggregating up to ₹60.98 crores, entirely comprising a fresh issue of 63.52 lakh shares.
The Offering at a Glance
| Detail | Information |
|---|---|
| Offering Period | July 14, 2025 – July 16, 2025 |
| Face Value | ₹10 per share |
| Price Range | ₹90 to ₹96 per share |
| Minimum Application Quantity | 1,200 Shares |
| Issue Nature | Fresh Capital |
| Total Offering Size | 63,51,600 shares (aggregating up to ₹60.98 Cr) |
| Exchange for Listing | NSE SME |
| Book-Running Lead Manager | Vivro Financial Services Private Limited |
| Registrar for the Issue | MUFG Intime India Private Limited (Link Intime) |
Investment Snapshot: Lot Sizes and Minimum Investment
Investors can bid for a minimum of 2,400 shares, and thereafter in multiples of 1,200 shares. The table below outlines the minimum and maximum investment amounts for retail and High Net Worth Individual (HNI) investors.
| Application Category | Lots | Shares | Amount (at upper price band ₹96) |
|---|---|---|---|
| Individual Investors (Retail) (Min) | 2 | 2,400 | ₹2,30,400 |
| Individual Investors (Retail) (Max) | 2 | 2,400 | ₹2,30,400 |
| Small HNI (Min) | 3 | 3,600 | ₹3,45,600 |
| Small HNI (Max) | 8 | 9,600 | ₹9,21,600 |
| Big HNI (Min) | 9 | 10,800 | ₹10,36,800 |
Understanding the Share Allotment: Investor Categories
The issue has specific reservation allocations for different investor categories:
| Investor Category | Shares Offered (Net Issue) |
|---|---|
| Qualified Institutional Buyers (QIB) | Not more than 50% |
| Retail Investors | Not less than 35% |
| Non-Institutional Investors (NII) | Not less than 15% |
Note: Bidding at cut-off price is not permitted for any category.
How Your Funds Will Be Used (Objectives of the Issue)
Spunweb Nonwoven Limited aims to utilize the net proceeds from this IPO for the following key objectives:
- Meeting the working capital requirements of the company (₹290 Million).
- Investing in its wholly-owned subsidiary, SIPL, to support its working capital needs (₹100 Million).
- Full or partial repayment of certain existing borrowings (₹80 Million).
- General corporate purposes, providing flexibility for future growth initiatives.
Anchor Investor Participation
Details regarding anchor investor participation, including shares offered, anchor portion size, and lock-in period end dates, are typically finalized closer to the bid date. For Spunweb Nonwoven IPO, the Anchor bid date is July 11, 2025.
The Timeline to Listing: A Step-by-Step Calendar
*The above timeline provides tentative dates for the Spunweb Nonwoven IPO process.
Investors should always verify final dates closer to the events.
A Deep Dive into Spunweb Nonwoven's Foundation
Financial Performance: Weaving Growth
Spunweb Nonwoven Limited has demonstrated strong financial growth. Their revenue increased by an impressive 47%, and their profit after tax (PAT) saw a substantial rise of 98% between the financial year ending March 31, 2024, and March 31, 2025. Here's a glance at their restated consolidated financials:
| Period Ended | 31 Mar 2025 | 31 Mar 2024 | 31 Mar 2023 |
|---|---|---|---|
| Assets (₹ Crore) | 182.76 | 106.58 | 93.15 |
| Revenue (₹ Crore) | 227.14 | 154.24 | 117.68 |
| Profit After Tax (₹ Crore) | 10.79 | 5.44 | 1.13 |
| EBITDA (₹ Crore) | 31.23 | 15.01 | 10.80 |
| Net Worth (₹ Crore) | 43.15 | 25.09 | 20.15 |
| Reserves and Surplus (₹ Crore) | 27.30 | 15.77 | 10.33 |
| Total Borrowing (₹ Crore) | 91.16 | 48.33 | 49.50 |
Valuation Insights: Key Performance Metrics
As of March 31, 2025, the market capitalization of Spunweb Nonwoven IPO is ₹231.39 Crores. Key performance indicators provide a deeper look into the company's financial health:
| Metric | Value (as of March 31, 2025) |
|---|---|
| Return on Equity (ROE) | 31.63% |
| Return on Capital Employed (ROCE) | 33.66% |
| Debt/Equity Ratio | 2.11 |
| Return on Net Worth (RoNW) | 31.63% |
| PAT Margin | 4.75% |
| EBITDA Margin | 13.75% |
| Price to Book Value | 3.95 |
Comparative EPS and P/E Ratios:
| Metric | Pre-Offering | Post-Offering |
|---|---|---|
| Earnings Per Share (EPS) | ₹6.08 | ₹4.48 |
| Price/Earnings (P/E) Ratio | 15.79x | 21.44x |
*The Pre-Offering EPS is based on the pre-issue shareholding and the latest FY25 earnings. The Post-Offering EPS is calculated based on the post-issue shareholding and annualized FY25 earnings.
Shareholding Structure: Promoter's Stake
The company's promoters are Jay Dilipbhai Kagathara and Kishan Dilipbhai Kagathara.
| Holding Category | Percentage |
|---|---|
| Promoter Holding (Pre-Offering) | 88.50% |
| Promoter Holding (Post-Offering) | Value to be calculated post-equity dilution |
Strategic Outlook: A SWOT Perspective
Understanding the internal and external factors influencing Spunweb Nonwoven's potential can offer valuable insights for prospective investors.
Strengths
- Leading position as one of India's largest spunbond nonwoven fabric manufacturers.
- Diverse product portfolio serving multiple sectors (hygiene, medical, packaging, agriculture, construction).
- Strong export presence across North America, Europe, and the Middle East, diversifying revenue streams.
- Commitment to quality with advanced testing facilities and cleanroom technology.
- Consistent financial growth with significant increases in revenue and profit after tax.
- Experienced management team and promoters providing strategic direction.
Weaknesses
- Relatively high Debt/Equity ratio (2.11), indicating a reliance on borrowed capital.
- Significant dependence on the hygiene sector for revenue (over two-thirds), which could pose concentration risk.
- SME listing may offer lower liquidity compared to mainboard listings, which is common for smaller companies.
Opportunities
- Growing demand for non-woven fabrics across various industries, driven by increased awareness of hygiene, medical advancements, and sustainable packaging.
- Potential for further expansion in international markets, leveraging existing export networks.
- Opportunity to reduce debt through IPO proceeds, strengthening the balance sheet and improving financial ratios.
- Expansion of manufacturing capabilities or diversification into allied products to capture more market share.
Threats
- Intense competition from both domestic and international manufacturers in the non-woven fabric industry.
- Volatility in raw material prices (e.g., polymers) could impact profit margins.
- Changes in regulatory policies or environmental standards related to manufacturing could lead to increased operational costs.
- Economic slowdowns or global supply chain disruptions affecting demand for industrial textiles.
- Currency fluctuations impacting export revenues and import costs.
Engaging with the Offering
How to Participate: Applying for the IPO
Interested investors can apply for the Spunweb Nonwoven IPO online using either UPI or ASBA as a payment method. Many leading brokerage platforms offer a seamless application process directly from their back office or trading platforms. You'll typically need to enter your UPI ID, the quantity of shares, and the bid price, then approve the mandate via your UPI application.
The finalization of the basis of allotment is expected on July 17, 2025, with shares credited to your demat account by July 18, 2025. The tentative listing date on NSE SME is July 21, 2025.
Key Contacts for Inquiries
For any further information or queries regarding the IPO, you can reach out to:
- Spunweb Nonwoven Limited (Company Contact):
- Phone: +91-87 5894 4844
- Email: cs@spunweb.in
- Website: www.spunweb.com
- Registrar to the Issue (MUFG Intime India Private Limited):
- Phone: +91-22-4918 6270
- Email: spunweb.ipo@linkintime.co.in
- Website: https://linkintime.co.in/Initial_Offer/public-issues.html
Final Thoughts
The Spunweb Nonwoven IPO presents an interesting opportunity in the rapidly evolving non-woven fabric sector, driven by strong fundamentals and growth prospects. While the company demonstrates robust financial performance and competitive strengths, it's essential for potential investors to consider the associated risks, including a higher debt-to-equity ratio and market-specific vulnerabilities.
As with any investment in the primary market, it is prudent to conduct your own thorough research, consider your personal financial objectives, and consult with a qualified financial advisor. Understanding all facets of the company and the market will enable you to make a well-informed decision regarding this upcoming public offering.