Borana Weaves Limited IPO Analysis
1. Business Overview
Borana Weaves Limited is engaged in textile manufacturing, specializing in unbleached synthetic grey fabric and Partially Oriented Yarn (PTY Yarn).
| Aspect | Details |
|---|---|
| Company Name | Borana Weaves Limited |
| Industry | Textile manufacturing (unbleached synthetic grey fabric & PTY Yarn) |
| HQ | Surat, Gujarat |
| Plants | 3 manufacturing units with:
|
| Promoters | Mangilal Ambalal Borana & family |
| Website | https://www.boranagroup.in/ |
My take: Borana Weaves is focused on a niche (grey fabric) with modern weaving tech. This aligns with growth in the synthetic textile space.
2. Key Dates
| Event | Date |
|---|---|
| IPO Open | 20‑May‑2025 |
| IPO Close | 22‑May‑2025 |
| Allotment Date | 23‑May‑2025 |
| Listing Date | 27‑May‑2025 |
IPO Details
| Face Value | ₹10 per share |
| Price Band | ₹205 – ₹216 per share |
| BSE Symbol | 526642 (Note: This appears to be a placeholder or existing symbol. IPOs get new symbols.) |
| Issue Size | Up to ₹144.89 crore (Equity Shares) |
Lot Info
| Lot Size | 69 shares |
| Minimum Investment (Upper Band) | 69 × ₹216 = ₹14,904 |
| Minimum Investment (Lower Band) | 69 × ₹205 = ₹14,145 |
3. Subscription Status (Day 1)
The IPO subscription details for Day 1 indicate significant interest, especially from retail investors.
| Category | Day 1 Subscription |
|---|---|
| Qualified Institutions (QIB) | 1.54× |
| S-HNI (≤ ₹10 Lakh) | 16.09× |
| B-HNI (> ₹10 Lakh) | 9.33× |
| Retail Investors | 25.29× |
| TOTAL | 8.60× |
Retail category is oversubscribed by 25.29×.
4. Grey Market Premium (GMP) & Estimated Profit
As of 20 May 2025:
GMP: ₹60 per share (~28%)
Est. Profit (Retail, 1 Lot): 69 shares × ₹60 = ₹4,140
Est. Profit (HNI, 14 Lots / 966 shares): 966 shares × ₹60 = ₹57,960
If you apply for one lot, potential listing day profit could be around ₹4,140, assuming GMP holds.
5. Financial Snapshot
Key financial figures from the RHP and analyst one-pager:
| Metric | FY 2022 | FY 2023 | FY 2024 | Dec 2024 (9M FY25) |
|---|---|---|---|---|
| Sales (₹ Cr) | 42 | 135 | 199 | 212 |
| Operating Profit (₹ Cr) | 5 | 26 | 41 | 46 |
| Net Profit (₹ Cr) | 2 | 16 | 24 | 29 |
Key Performance Indicators (KPIs)
| Metric | FY 2022 | FY 2023 | FY 2024 | Dec 2024 (9M FY25) |
|---|---|---|---|---|
| OPM (%) | 12% | 19% | 21% | 22% |
| NPM (%) | 5% | 12% | 12% | 14% |
| Avg. Capacity Utilisation | 57% | 84% | 80% | 80% |
| Employee Count | 193 | 568 | 793 | 666 |
At the upper band, P/E is ~24.4× based on FY 2024 PAT. This is considered in line with niche textile peers.
6. Peer Comparison
Borana Weaves compared to listed synthetic textile players:
| Company | Revenue (₹ Cr) | PAT (₹ Cr) | PAT Margin | P/E |
|---|---|---|---|---|
| Borana Weaves | 199 | 24 | 12% | 24 |
| Sangam | 2,628 | 41 | 2% | 56 |
| VTM | 208 | 18 | 9% | 27 |
| Century Enka | 1,744 | 46 | 3% | 15 |
Borana sits in the mid-range P/E pack, reflecting its higher margins and growth potential.
Also Read: Belrise Industries limited IPO Date, Price, GMP & Review
7. What the organization does best and its opportunities.
Pros
- Improvements in water-jet looms → production of uniform results.
- Experienced a rise in revenue growth at an annual rate of 85% over the past 2 years.
- Job centers in Surat allow easy access to workers and supplies.
- An additional unit and working capital are developed using IPO funding.
Opportunities
- More clothes are being made with synthetic fabric (due to its cost and durability).
- Opportunities exist to team up with well-known apparel / home-decor companies.
- If the percentage of capacity used is higher than 80%, it is considered an advantage (currently at 80%).
8. Recognizing Problematic Signs (Risks)
- The top 10 clients accounted for 45% of the revenue recorded in December ’24 (Client Concentration Risk).
- The approval of new units from regulators may lead to stalled growth.
- Price competition: Many companies in the textile industry raise pricing pressure.
- Only a few years old: The company started operating in 2020 (Limited Track Record).
Whenever investigating the Borana Weaves IPO, remember to stay aware of the risks. Do not invest cash you may need within the next 2–3 years.
9. Should You Try to Buy Borana Weaves IPO Shares?
My Perspective:
If you like to build your portfolio through IPOs, have a positive outlook on India’s textile sector and can cope with valuation risk, applying for one lot of the Borana Weaves IPO might suit you.
Key Positives:
- Company is growing.
- Uses up-to-date technologies.
- Good profit margins.
Key Concerns:
- Depending heavily on a few clients.
- Capacity is close to full (80%).
If you are risk-averse or extremely cautious, you may wish to observe before investing when trading starts.
10. What Should You Put Into Your Investments?
- Minimum (Retail) Investment: 1 lot (69 shares), costing ₹14,145 (lower band) to ₹14,904 (upper band).
- Maximum (Retail) Investment: 1 lot (69 shares). (Note: Retail investors can apply for more lots up to ₹2 lakhs, but allotment is typically for 1 lot in oversubscribed IPOs).
- Estimated Profit per Lot (based on GMP): ~₹4,140 (with GMP of ₹60).
While a high-net-worth individual (HNI) might apply for a minimum of 966 shares (14 lots), for most retail investors, applying for one lot is common for IPOs with high subscription.
11. How to Apply & Contact Information
Application Process:
You can apply through:
- UPI via your broker's IPO platform (e.g., Zerodha, Upstox).
- ASBA (Applications Supported by Blocked Amount) through your bank's net banking.
- Tradeswift IPO platform: https://ipo.tradeswift.net (ensure this is a legitimate platform if using).
Always ensure you have sufficient funds in your bank account linked for UPI/ASBA.
Key Contacts:
- Compliance Officer: Seema Luniya
- Email: info@boranagroup.in
- Phone: +91-9898426338
- Book Running Lead Manager (BRLM): Beeline Mercantile Pvt. Ltd.
- Email: mb@beelinemfb.com
- Phone: +91-079-49185784
Author's Take: "I plan to join one lot since it helps me capture any gains from the first day of trading. After the list is finished, I will reconsider holding those stocks depending on their current movement and the industry climate."
Use this information to aid your decision. Have faith in the rising use of synthetic grey fabric. Consider that even renowned investors like Buffett sometimes buy companies at a P/E multiple of 24 times earnings if growth prospects are strong.
Frequently Asked Questions (FAQs) – Borana Weaves IPO
1. What is the Borana Weaves IPO?
The Borana Weaves IPO is an Initial Public Offering by Borana Weaves Limited, a textile company based in Surat, Gujarat. The company is looking to raise up to ₹144.89 crore through the issue of equity shares via a book-building process. They specialize in unbleached synthetic grey fabric and PTY Yarn.
2. When will the Borana Weaves IPO open and close?
IPO Open Date: 20 May 2025
IPO Close Date: 22 May 2025
This is the window during which you can apply for the IPO shares.
3. What are the IPO price band and lot size for Borana Weaves?
Price Band: ₹205 to ₹216 per share.
Lot Size: 69 shares.
Minimum Investment: ₹14,145 (at ₹205/share) to ₹14,904 (at ₹216/share) for one lot.
BSE Symbol (Tentative/Placeholder): 526642 (Final symbol will be confirmed upon listing).
4. What profits could I see from the Borana Weaves IPO listing?
Based on a Grey Market Premium (GMP) of ₹60 per share (as of 20 May 2025):
If you are allotted one lot of 69 shares, the potential estimated profit on listing day could be approximately ₹4,140 (69 shares * ₹60 GMP). This is an estimate and can change based on market conditions and actual GMP at the time of listing.
5. How can I apply for the Borana Weaves IPO?
You can apply for the Borana Weaves IPO through the following methods:
- Online Broker Platforms: Use the IPO application facility provided by your stockbroker (e.g., Zerodha, Upstox, Groww, ICICI Direct, HDFC Securities). This is often done via UPI.
- ASBA: Through your bank's net banking portal using the ASBA (Application Supported by Blocked Amount) facility.
- Third-party IPO Platforms: Such as the mentioned https://ipo.tradeswift.net (ensure to verify the platform's authenticity).
Make sure you have sufficient funds blocked in your bank account for the application.
6. Which investors are allowed to purchase shares in the Borana Weaves IPO?
Different categories of investors can apply, with specific minimum application sizes:
- Retail Individual Investors (RIIs): Minimum 1 lot (69 shares). Can apply up to ₹2 lakhs.
- Small High Net-worth Individuals (S-HNI): Applications between ₹2 lakhs and ₹10 lakhs. Minimum bid might be around 966 shares (14 lots) or as specified in the RHP.
- Big High Net-worth Individuals (B-HNI): Applications above ₹10 lakhs. Minimum bid might be around 4,692 shares (68 lots) or as specified.
- Qualified Institutional Buyers (QIBs): Eligible as per SEBI regulations for allocation.
7. What makes Borana Weaves stand out?
Key strengths that attract investors to Borana Weaves include:
- Modern Technology: Use of up-to-date water-jet looms and high-tech texturizing machines, leading to uniform product quality.
- Strong Revenue Growth: An average Compounded Annual Growth Rate (CAGR) of 85% in revenue over the last two reported fiscal years.
- Healthy Operating Margins: Maintained operating profit margins (OPM) around 21-22% in FY 2024 and for the nine months ending December 2024.
- Strategic Location: Based in Surat, a major textile hub, providing access to skilled labor and raw material supply chains.
- Expansion Plans: IPO proceeds are intended for setting up an additional unit and for working capital, indicating future growth.
8. What are the most important risks related to the Borana Weaves IPO?
Potential investors should consider these risks:
- Client Concentration: The top 10 customers contribute a significant portion (45% as of Dec '24) of revenues, making the company dependent on them.
- Regulatory Approvals: Delays in getting regulatory approvals for the planned new manufacturing unit could hinder expansion and growth.
- Competitive Industry & Pricing Pressure: The textile industry is highly competitive, which can put pressure on pricing and margins.
- Limited Operating History: The company started its operations relatively recently (in 2020), meaning it has a shorter track record compared to established players.
- High Capacity Utilization: While good, an 80% capacity utilization means there's limited immediate room for organic growth without the new unit coming online.
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