Borana Weaves Limited, a textile manufacturer based in Surat, is set to launch its initial public offering (IPO) from May 20 to May 22, 2025. The company specializes in producing unbleached synthetic grey fabric, a fundamental raw material widely used across industries such as fashion, traditional textiles, technical textiles, home décor, and interior design. This grey fabric plays a crucial role as a versatile base fabric suitable for dyeing, printing, and other value-added processes, making Borana Weaves an important player in the textile supply chain.

The Borana Weaves IPO is a Book Built Issue amounting to ₹ 144.89 Crores, comprising a fresh issue of 67.08 lakh equity shares. The price band for the IPO is fixed between ₹ 205 and ₹ 216 per equity share, with a market capitalization estimated at ₹ 575.53 Crores at the upper price band. The IPO lot size is set at 69 shares, requiring a minimum investment of ₹ 14,904 for retail investors, while high-net-worth individuals (HNIs) must invest in a minimum of 14 lots (966 shares), totaling ₹ 2,08,656.

The subscription period opens on May 20, 2025, and closes on May 22, 2025. Following this, the allotment of shares is expected to be finalized on or about May 23, 2025, with shares listing on the NSE and BSE anticipated around May 27, 2025. The registrar for the IPO is KFIN Technologies Limited, while Beeline Capital Advisors Private Limited acts as the book running lead manager.

An important indicator for IPO investors, the Grey Market Premium (GMP), currently stands at around ₹ 50, implying an expected listing gain of approximately 23.14%. It is crucial to note that GMP is an unofficial market price driven by demand and supply dynamics in the unorganized market and should be considered informational rather than definitive. The GMP suggests a positive market sentiment toward Borana Weaves Limited based on its financial performance and growth potential.

As of the final subscription day on May 22, 2025, at 10:30 AM, the Borana Weaves IPO witnessed an impressive subscription rate of 40.85 times, reflecting robust investor confidence and demand for the issue. The IPO has also attracted anchor investors, raising ₹ 65.20 Crores by allocating 30,18,453 shares at ₹ 216 per share. Anchor investor participation adds credibility and strength to the IPO, indicating strong institutional support.

The proceeds from the IPO will be utilized for strategic growth initiatives. A major portion, ₹ 7,134.77 Lakh, is earmarked for financing the construction of a new manufacturing unit (Proposed Unit 4) in Surat to enhance production capacity of grey fabric. Additionally, ₹ 2,650 Lakh will be allocated to meet incremental working capital requirements, ensuring smooth operational efficiency. The remaining funds will be used for general corporate purposes.

Borana Weaves Limited is led by experienced promoters and directors with deep expertise in the textile industry. Mangilal Ambalal Borana, the promoter and executive director, brings over 24 years of experience, while Ankur Mangilal Borana and Rajkumar Mangilal Borana contribute more than 13 years each. This seasoned leadership has helped drive the company’s consistent financial growth.

Financially, Borana Weaves has demonstrated strong performance over recent years. Revenue from operations grew from ₹ 4,236.11 Lakh in 2022 to ₹ 21,570.70 Lakh for the period ended December 31, 2024. EBITDA rose from ₹ 520.16 Lakh in 2022 to ₹ 4,939.71 Lakh by December 2024, indicating improving profitability. Profit after tax increased significantly from ₹ 179.86 Lakh in 2022 to ₹ 2,930.63 Lakh for the period ended December 31, 2024.

Key financial ratios highlight the company’s strength with a pre-issue earnings per share (EPS) of ₹ 11.83 and post-issue EPS of ₹ 8.85 for FY24. The pre-issue price-to-earnings (P/E) ratio stands at 18.26x, while the post-issue P/E ratio is 24.40x. The return on capital employed (ROCE) is an impressive 27.42%, return on equity (ROE) is 49.45%, and return on net worth (RoNW) is 49.77%. These figures indicate a healthy and fairly priced IPO with strong potential for growth and returns.

The Borana Weaves IPO offers an excellent opportunity for investors to participate in a growing textile manufacturing company with a niche product — unbleached synthetic grey fabric — essential for multiple downstream industries. The IPO’s attractive pricing, robust subscription, and positive GMP signal likely listing gains and a promising investment proposition.

Investors keen on the textile sector, especially those interested in companies expanding their manufacturing capacity in Surat, Gujarat, may find Borana Weaves IPO a valuable addition to their portfolio. Given the company’s consistent financial performance, experienced promoters, and clear growth plans, applying for the IPO appears prudent for both retail and institutional investors.

To check the IPO allotment status after the subscription period closes, investors can visit the registrar’s website starting May 23, 2025. By entering their application number, PAN, or DP Client ID, they can quickly verify their allotment outcome and prepare for listing.

In summary, the Borana Weaves IPO presents a compelling investment opportunity with its fresh issue of ₹ 144.89 Crores, solid financial track record, positive Grey Market Premium, and strong market response. The company’s focus on expanding production capacity and maintaining leadership in the synthetic grey fabric segment underlines its long-term growth potential. Interested investors should consider applying during the subscription window from May 20 to May 22, 2025, to benefit from the potential listing gains expected around May 27, 2025.

The Upcoming IPOs in this week and coming weeks are Neptune Petrochemicals, Aegis Vopak Terminals, Schloss Bangalore, Astonea Labs, Nikita Papers, Prostarm Info Systems, Victory Electric Vehicles International, Blue Water Logistics, Wagons Learning.

The Current active IPO are Unified Data - Tech Solutions, Dar Credit and Capital, Belrise Industries, Borana Weaves.

Start your Stock Market Journey and Apply in IPO by Opening Free Demat Account in Choice Broking FinX.

Join our Trading with CA Abhay Telegram Channel for regular Stock Market Trading and Investment Calls by CA Abhay Varn - SEBI Registered Research Analyst.