The Cedaar Textile Limited IPO, a Book Built Issue worth ₹ 60.9 Crores, concluded its subscription phase on 2nd July 2025 with an underwhelming subscription rate of 0.71 times. Despite strong financial growth and a diversified product range, the IPO did not manage to attract the attention of retail or institutional investors as expected. Notably, the Grey Market Premium (GMP) for Cedaar Textile IPO remained at ₹ 0, signaling no premium or enthusiasm in the unofficial trading market.

About Cedaar Textile Limited

Cedaar Textile Limited is a specialized yarn manufacturer, offering an expansive product line including Melange Yarns, Solid Top Dyed Yarns, and Grey Fancy Yarns across various fibers like cotton, polyester, acrylic, viscose, Tencel, and Modal. A distinguishing factor in Cedaar’s operations is its commitment to sustainability—the company focuses on offering 100% organic and recycled fibers, particularly polyester and cotton, to foster eco-conscious manufacturing and reduce its environmental footprint.

The company is promoted by Mr. Rajesh Mittal and Mr. Virender Goyal, who bring a cumulative 61 years of experience in the textile industry. Their expertise and management direction have enabled Cedaar Textile to build a strong foothold in both domestic and international yarn markets.

Cedaar Textile IPO Details

• IPO Size: ₹ 60.9 Crores

• Issue Type: Book Built Issue

• Shares Offered: 43.50 lakh equity shares (Fresh Issue)

• Price Band: ₹ 130 – ₹ 140 per equity share

• Minimum Lot Size: 1,000 shares

• Retail Investment Minimum: ₹ 1,40,000

• HNI Investment Minimum: ₹ 2,80,000 (2 lots)

• Market Capitalisation at Upper Band: ₹ 194.30 Crores

• Listing on: NSE SME

• IPO Open Date: 30 June 2025

• IPO Close Date: 2 July 2025

• Allotment Date: 3 July 2025 (Thursday)

• Tentative Listing Date: 7 July 2025 (Monday)

The Book Running Lead Manager (BRLM) is FAST TRACK FINSEC PRIVATE LIMITED, the registrar is SKYLINE FINANCIAL SERVICES PRIVATE LIMITED, and NNM Securities Private Limited serves as the Market Maker.

IPO Subscription Status

As of 11:00 AM on 2 July 2025, Cedaar Textile IPO had been subscribed only 0.71 times, indicating lackluster interest. While the offer structure included allocation to Qualified Institutional Buyers (QIBs), Non-Institutional Investors (NIIs), and Retail Individual Investors (RIIs), none of the categories were fully subscribed.

Anchor Investors Update

On 25 June 2025, Cedaar Textile raised ₹ 10.94 Crores through Anchor Investors at a price of ₹ 140 per share, allocating 7,82,000 equity shares. Although this move was expected to generate momentum, it did not translate into meaningful retail traction.

Grey Market Premium (GMP) Trend

The flat GMP suggests a lack of speculative trading interest and casts doubts on the potential for listing gains.

Objectives of the IPO

Cedaar Textile intends to utilize the net proceeds from the issue as follows:

1. ₹ 800.00 Lakhs – Installation of Grid-tied Solar PV Rooftop System

2. ₹ 1,700.00 Lakhs – Modernization of Machinery

3. ₹ 2,490.00 Lakhs – Working Capital Requirements

4. Unspecified Amount – General Corporate Purposes

5. Balance – Public Issue Expenses

The company's green energy initiatives and automation plans show a focus on long-term efficiency and ESG compliance.

Financial Performance

Cedaar Textile has demonstrated a mixed revenue trend, with FY24 revenue falling from FY22 levels but recovering over time.

Revenue from Operations

• 9M FY2025 (Dec 31, 2024): ₹ 11,390.67 Lakhs

• FY 2024: ₹ 19,101.24 Lakhs

• FY 2023: ₹ 16,187.94 Lakhs

• FY 2022: ₹ 22,043.72 Lakhs

EBITDA

• 9M FY2025: ₹ 2,208.57 Lakhs

• FY 2024: ₹ 2,952.39 Lakhs

• FY 2023: ₹ 1,726.39 Lakhs

• FY 2022: ₹ 1,829.30 Lakhs

Profit After Tax (PAT)

• 9M FY2025: ₹ 706.18 Lakhs

• FY 2024: ₹ 1,105.05 Lakhs

• FY 2023: ₹ 458.94 Lakhs

• FY 2022: ₹ 798.63 Lakhs

While profits have increased from FY23 to FY24, the declining revenue trend from FY22 still raises questions about long-term scalability.

Key Financial Ratios and Valuation Metrics

• Pre-Issue EPS (FY24): ₹ 14.73

• Post-Issue EPS (FY24): ₹ 7.96

• Pre-Issue P/E Ratio: 9.50x

• Post-Issue P/E Ratio: 17.58x

• Industry P/E Benchmark: 20.00x

• ROCE (FY24): 26.90%

• ROE (FY24): 56.06%

• RoNW: 56.06%

• Annualized EPS: ₹ 6.78

• Annualized P/E: 20.64x

Although return ratios are strong, the post-issue valuation seems slightly stretched, especially for a company in the SME segment facing demand challenges.

IPO Allotment – How to Check

Investors can check the Cedaar Textile IPO allotment status on or after 3 July 2025 through the registrar's website. Follow the steps below:

1. Visit the IPO allotment status portal.

2. Select "Cedaar Textile Limited" from the IPO dropdown.

3. Enter Application Number, PAN, or DP Client ID.

4. Click Submit to view your allotment status.

Allotment details will also be accessible via email/SMS notifications by the registrar.

Expert Review and Investment Outlook

Despite Cedaar Textile’s:

• Product diversification

• Sustainability focus

• Strong return ratios

the underwhelming subscription, flat GMP, and declining revenue trends cannot be ignored. Additionally, the high minimum investment of ₹ 1.4 lakhs for retail investors could have dissuaded broader participation.

The IPO's post-issue valuation (P/E of 17.58x) approaches the industry average (20x), suggesting that there's limited headroom for upside at listing.

Recommendation: Avoid for Listing Gains

Based on the current market sentiment, IPO subscription figures, and financials:

Recommendation: Avoid Cedaar Textile IPO for listing gains.
Investors may consider re-evaluating the company post-listing depending on secondary market performance and future earnings guidance.

Disclaimer:

The information presented here is purely for educational and informational purposes. It should not be considered as investment advice or a recommendation. All financial data is based on public sources and may be subject to change. Readers must consult with a SEBI-registered financial advisor before making investment decisions. Investing in IPOs and equities involves market risks. Read all related documents and risk factors carefully.

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