UNITED COTFAB LIMITED is a manufacturer of high-quality open-end yarn for the textile industry. The company's clients include textile manufacturers, garment exporters and distributors. The company's product portfolio includes Open End Cotton Yarn and Cotton Yarn.
UNITED COTFAB LIMITED, a Fixed Price issue amounting to Rs 36.28 crores, consisting entirely of a fresh issue of 51.84 lakh shares. The subscription period for the IPO opens on June 13, 2024, and closes on June 19, 2024. The allotment is expected to be finalized on THURSDAY, JUNE 20, 2024, and the shares will be listed on the BSE SME with a tentative listing date set for MONDAY, JUNE 24, 2024.
The price is set at ₹70 per share, with a minimum lot size of 2000 shares. Retail investors are required to invest a minimum of ₹140,000, while the minimum investment for High-Net-Worth Individuals (HNIs) is 2 lots (4000 shares), amounting to ₹280,000.
Beeline Capital Advisors Private Limited is the book-running lead manager, Purva Sharegistry (India) Private Limited is the registrar. Spread X Securities Private Limited is also the market maker for the United Cotfab IPO.
Grey Market Premium (GMP) of United Cotfab Limited
The Grey Market Premium is expected in the range of Rs 11 - Rs. 21 based on the financial performance of the company. No real trading is done on the basis of Grey Market Premium that's why no real discovery of price can be done before the listing of shares on the stock exchange. The Grey Market Premium totally depends upon the Demand and Supply of the shares of the company in unorganized manner which is not recommended. The Grey Market Premium is mentioned for educational and informational purposes only.
Objectives of United Cotfab Limited
United Cotfab Issue Proceeds from the Fresh Issue will be utilized towards the following objects:
1. To Meet Working Capital Requirements
2. General Corporate Purposes
Refer to UNITED COTFAB RHP for more details about the Company.
UNITED COTFAB IPO Details |
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IPO Date | June 13, 2024 to June 19, 2024 | ||||||||||
Listing Date | June 24, 2024 | ||||||||||
Face Value | ₹10 | ||||||||||
Price | ₹70 per share | ||||||||||
Lot Size | 2000 Shares | ||||||||||
Total Issue Size | 5184000 Equity Shares (aggregating to ₹36.28 Cr) | ||||||||||
Fresh Issue | 5184000 Equity Shares (aggregating to ₹36.28 Cr) | ||||||||||
Offer for Sale | Nil | ||||||||||
Issue Type | Fixed Price Issue IPO | ||||||||||
Listing At | BSE SME | ||||||||||
Share holding pre issue | 1,20,06,000 | ||||||||||
Share holding post issue | 1,71,90,000 |
UNITED COTFAB IPO Lot Size |
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Application | Lots | Shares | Amount | ||||||||
Retail (Min) | 1 | 2000 | ₹140,000 | ||||||||
Retail (Max) | 1 | 2000 | ₹140,000 | ||||||||
HNI (Min) | 2 | 4000 | ₹280,000 |
UNITED COTFAB IPO Timeline (Tentative Schedule) |
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IPO Open Date | THURSDAY, JUNE 13, 2024 | ||||||||||
IPO Close Date | WEDNESDAY, JUNE 19, 2024 | ||||||||||
Basis of Allotment | THURSDAY, JUNE 20, 2024 | ||||||||||
Initiation of Refunds | FRIDAY, JUNE 21, 2024 | ||||||||||
Credit of Shares to Demat | FRIDAY, JUNE 21, 2024 | ||||||||||
Listing Date | MONDAY, JUNE 24, 2024 | ||||||||||
Cut-off time for UPI mandate confirmation | 5 PM on WEDNESDAY, JUNE 19, 2024 |
UNITED COTFAB IPO Reservation |
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Investor Category | Shares Offered | Reservation % | |||||||||
Retail Shares Offered | 24,62,000 | 50% of the Net Issue | |||||||||
Non-Retail Shares Offered | 24,62,000 | 50% of the Net Issue | |||||||||
Market Maker Portion | 260,000 | - |
UNITED COTFAB IPO Promoter Holding |
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Share Holding Pre Issue | 99.99 | ||||||||||
Share Holding Post Issue | 69.84 |
UNITED COTFAB IPO Subscription Status |
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Investor Category | Shares Offered | Shares Bid For | No oF Times Subscribed |
United Cotfab Limited (Formerly Known as the United Cotfab LLP and United Cotfab Private Limited) operating since 2015 in the Textile Industry in Ahmedabad, Gujarat. They are engaged in the manufacturing of high-quality open end yarn, catering to the textile industry. With a strong focus on innovation, quality, and customer satisfaction, they have established themselves as a trusted name in the market. Their state-of-the-art manufacturing facility and dedicated team ensure that they deliver exceptional products to meet the diverse needs of their clients.
Their vision is to be recognized as a preferred supplier of open end yarn, known for their commitment to excellence, sustainable practices, and customer-centric approach. They strive to contribute to the growth and success of their clients by providing them with reliable and superior-quality products.
The company have over 25 years of working experience and have sold over 50 of their products to more than 325 trusted & satisfied clients. Notable trusted clients are as follows, Jindal, Anubha, aarbhee, Pratap Group, JRD Denims Ltd., Sangam & E-LAND APPAREL.
TEXTILE SECTOR IN INDIAN INDUSTRY
▪ India is the world’s second-largest producer of textiles and garments. India is the world's 3rd largest exporter of Textiles and Apparel.
▪ The textiles and apparel industry contributes 2.3% to the country’s GDP, 13% to industrial production and 12% to exports.
▪ The textile industry has around 45 million workers employed in the textiles sector, including 3.5 million handloom workers.
▪ India’s textile and apparel exports (including handicrafts) stood at US$ 44.4 billion in FY22, a 41% increase YoY and Total textile exports are expected to reach US$ 65 billion by FY26.
▪ The Indian textile and apparel industry is expected to grow at 10% CAGR from 2019-20 to reach US$ 190 billion by 2025-26.
▪ The Rs. 10,683 crore (US$ 1.44 billion) PLI scheme is expected to be a major boost for textile manufacturers. The scheme proposes to incentivise MMF (man-made fibre) apparel, MMF fabrics and 10 segments of technical textiles products.
▪ Mr. Piyush Goyal discussed the roadmap to achieve the target of US$ 250 billion in textiles production and US$ 100 billion in exports by 2030.
UNITED COTFAB LIMITED STRENGTHS & STRATEGIES
1. Cost Effective Manufacturing Process
2. Entering into new geographies
3. Maintaining strong relationship with customers
4. Optimum Utilization of Resources
5. Experienced Promoters
6. Location advantage of our manufacturing facility
7. Scalable Business Model
UNITED COTFAB LIMITED RISK FACTORS & CONCERNS
1. Company's revenues are highly dependent on their operations in geographical region of state of Gujarat & Maharashtra.
2. The Company is dependent and will continue to depend on their manufacturing facilities.
3. Company requires deployment of labour and depend on availability of labour.
4. The Comapny may face foreign exchange risks that could adversely affect their results of operations and cash flows.
5. Any future issuance of their Equity Shares may dilute prospective investors’ shareholding, and sales of their Equity Shares by their major shareholders.
6. Company's lenders have charge over their movable and immovable properties in respect of finance availed by them.
Period Ended | Mar 31, 2024 | Mar 31, 2023 | Mar 31, 2022 | Mar 31, 2021 |
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Reserve of Surplus | 188.10 | - | - | - |
Total Assets | 8168.46 | 5,367.71 | 1,559.95 | 107.10 |
Total Borrowings | 4750.93 | 3821.18 | 773.47 | 106.50 |
Fixed Assets | 4461.00 | 3800.25 | 359.88 | - |
Cash | 0.07 | 1.09 | 15.81 | 20.58 |
Net Borrowing | 4750.86 | 3820.09 | 757.66 | 85.92 |
Revenue | 11,529.41 | 44.20 | - | - |
EBITDA | 1790.94 | 20.98 | 1.60 | 0.11 |
PAT | 866.65 | 13.93 | 1.60 | 0.11 |
EPS | 7.97 | 0.14 | 0.02 | 0.00 |
Note 1:- ROCE, ROE is calculation is based on 31st Mar, 2024 Data.
Note 2:- EPS is based on 31st Mar, 2024 Data.
Key Performance Indicator |
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KPI | Values | ||||||||||
EPS Pre IPO (Rs.) | ₹ 7.97 | ||||||||||
EPS Post IPO (Rs.) | ₹ 5.04 | ||||||||||
P/E Pre IPO | 8.78 | ||||||||||
P/E Post IPO | 13.88 | ||||||||||
ROE | 72.76% | ||||||||||
ROCE | 26.95% | ||||||||||
P/BV | 2.41 | ||||||||||
Debt/Equity | 3.42 | ||||||||||
RoNW | 63.89% |
UNITED COTFAB Limited IPO Peer Comparison |
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Company Name | EPS | ROCE | ROE | P/E (x) | P/Bv | Debt/Equity | RoNW (%) | ||||
United Cotfab Ltd | ₹ 5.04 | 26.95% | 72.76% | 13.88 | 2.41 | 3.42 | 63.89% | ||||
Lagnam Spintex Ltd | ₹ 8.25 | 9.43% | 14.3% | 15.8 | 2.11 | 3.47 | 9.43% | ||||
PBM Polytex Ltd | ₹ -9.38 | -6.59 % | -5.32 % | - | 0.48 | 0.01 | -6.59 % | ||||
Vippy Spinpro Ltd | ₹ 7.41 | 7.36 % | 5.90 % | 22.9 | 1.31 | 0.82 | 7.36 % |
UNITED COTFAB LIMITED
Survey No. 191, Village-Timba, Taluka-Dascroi, Timba, Ahmedabad, Dascroi -382425, Gujarat, India
Contact Person : Ms. Muskan Kashyap
Tele No. : +91 9879874955
Email Id : info@unitedcotfab.com
Website : https://www.unitedcotfab.com/index.html#
Lead Manager - Beeline Capital Advisors Private Limited
Email : mb@beelinemb.com
Tel. No. : 079 4918 5784
Website : https://beelinemb.com/
Registrar - PURVA SHAREGISTRY (INDIA) PRIVATE LIMITED
Tele No. : +91 022 4961 4132 / 3199 8810
Email ID : support@purvashare.com
Website : https://www.purvashare.com/
UNITED COTFAB LIMITED is a manufacturer of high-quality open-end yarn for the textile industry. The company's clients include textile manufacturers, garment exporters and distributors. The company's product portfolio includes Open End Cotton Yarn and Cotton Yarn.
United Cotfab is promoted by Mr. Nirmalkumar Mangalchand Mittal and Mr. Gagan Nirmalkumar Mittal and they have a combined experience of more than 55 years in the field of cotton textile industry since 1983.
United Cotfab has operated full year in FY2024 only and has shown stellar performance in that year. The company has reported revenue of ₹ 115 Crore and Profit of ₹ 8.6 Crore. The company have generated good returns on Capital Employed at 26.95% and Return on Equity at 72.76%. RonW of the company is 63.89%.
For the IPO,United Cotfab is issuing shares at a pre-issue EPS of Rs. 7.97 and a post-issue EPS of Rs. 5.04. The pre-issue P/E ratio is 8.78, while the post-issue P/E ratio is 13.88 against the industry P/E ratio of 26. These metrics suggest that the IPO is fairly priced.
The Grey Market Premium (GMP) indicates potential listing gains of 15% - 30%. Given the company's steady financial performance and the valuation of the IPO, we recommend only Risky Investors to apply in the IPO for small listing gains and long term investors can also invest now or post debut in share market.
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