Cedaar Textile Limited has launched its ₹60.9 Crore IPO on the NSE SME platform, aiming to tap investor interest in sustainable manufacturing and the booming textile sector. The subscription window opens on June 30, 2025, and closes on July 02, 2025, with allotment expected on July 03, 2025, and tentative listing on July 07, 2025.

The IPO is a 100 percent Fresh Issue of 43.50 lakh shares, with a price band of ₹130 to ₹140 per equity share, implying a market capitalisation of ₹194.30 Crores at the upper end.

FAST TRACK FINSEC PRIVATE LIMITED is the lead manager, SKYLINE FINANCIAL SERVICES PRIVATE LIMITED acts as registrar, and NNM Securities Private Limited is the market maker.

The lot size is 1,000 shares, with retail minimum investment of ₹1,40,000 and HNIs needing to apply for at least 2 lots (₹2,80,000).

Business Overview and Product Range

Cedaar Textile is a specialist in Melange Yarns, Solid Top dyed Yarns, and Grey Fancy Yarns using fibres such as cotton, polyester, acrylic, viscose, Tencel, and Modal.

A major differentiator is its strong commitment to sustainability, with offerings in 100 percent Organic and Recycled Fibres (cotton and polyester) to support a green environment and conserve natural resources.

Their diverse catalogue supports demand for fashion, home textiles, industrial applications, and caters to both domestic and international clients.

Experienced Promoters with Industry Expertise

Cedaar Textile is led by Mr. Rajesh Mittal with 28 years of experience and Mr. Virender Goyal with 33 years of experience in the textile industry.

Their deep sectoral expertise ensures quality production, efficient operations, and solid relationships with suppliers and clients, making Cedaar Textile a trusted name in B2B yarn manufacturing.

Financial Performance and Growth

Cedaar Textile has shown steady financial growth over the years.

• Revenue from Operations

  • FY22: ₹22,043.72 Lakh

  • FY23: ₹16,187.94 Lakh

  • FY24: ₹19,101.24 Lakh

  • For period ended Dec 31, 2024: ₹11,390.67 Lakh

• EBITDA

  • FY22: ₹1,829.30 Lakh

  • FY23: ₹1,726.39 Lakh

  • FY24: ₹2,952.39 Lakh

  • Period ended Dec 31, 2024: ₹2,208.57 Lakh

• Profit After Tax (PAT)

  • FY22: ₹798.63 Lakh

  • FY23: ₹458.94 Lakh

  • FY24: ₹1,105.05 Lakh

  • Period ended Dec 31, 2024: ₹706.18 Lakh

This indicates consistent demand and efficient cost management despite market cycles.

Valuation and Key Metrics

Cedaar Textile has disclosed valuation metrics that suggest the IPO is fairly priced.

• Pre-issue EPS: ₹14.73

• Post-issue EPS: ₹7.96

• Pre-issue P/E: 9.50x

• Post-issue P/E: 17.58x

• Industry P/E: 20.00x

• ROCE (FY24): 26.90%

• ROE (FY24): 56.06%

• RoNW: 56.06%

• Annualised EPS: ₹6.78

• Annualised P/E: 20.64x

These figures suggest Cedaar Textile is priced in line with industry peers while offering strong return ratios.

Use of IPO Proceeds

Proceeds from the IPO will help Cedaar Textile to:

• Enhance working capital for growing demand

• Expand production capacity to handle more orders

• Invest in sustainable manufacturing technologies

• Strengthen distribution networks

This supports their green mission while enabling scalable growth.

Sustainability Focus as Competitive Advantage

Cedaar Textile's commitment to eco-friendly production is a key differentiator.

They produce yarns with:

• 100 percent Organic Fibres

• Recycled Polyester and Cotton

• Sustainable processing for reduced environmental impact

Such practices align with global demand for greener supply chains and help position Cedaar Textile as a preferred partner for brands prioritising sustainability.

Grey Market Premium (GMP) Insight

The GMP for Cedaar Textile IPO is currently ₹0, indicating no listing premium expected.

Investors should note:

• GMP is unregulated and based on informal demand-supply

• Real price discovery happens only on listing

• Analysts suggest not relying on GMP for investment decisions

Risks and Considerations

Key risks for investors to consider include:

• Fluctuating raw material prices impacting margins

• Dependence on cyclical textile demand

• Global competition and evolving buyer preferences

• SME segment liquidity constraints post-listing

These risks highlight the need for careful investor assessment.

Expert Recommendations

Given the current valuation, financial trends, and zero GMP, analysts have issued an Avoid recommendation for investors purely seeking listing gains.

However, longer-term investors may consider monitoring Cedaar Textile’s execution on:

• Sustainability investments

• Capacity expansions

• Revenue diversification

Conclusion

The Cedaar Textile IPO offers an investment in a sustainability-focused B2B yarn manufacturer with diverse products, experienced leadership, and a solid reputation.

Their commitment to green production and organic and recycled fibres aligns with industry trends and global buyer requirements.

While short-term listing gains seem unlikely, the company's fundamentals and sustainability edge may appeal to investors with a long-term horizon willing to navigate SME market risks.

Disclaimer:

This article is intended for informational and educational purposes only and does not constitute investment advice. Readers are advised to consult their financial advisor before making any investment decisions. Investments in securities are subject to market risks. Please read all related documents carefully before applying for the IPO. The data provided is based on publicly available information and may be subject to change.

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