NAPS Global India Limited, a leading wholesale importer of textile products, made a strong debut on the BSE SME with shares listing 20% higher than the issue price of ₹90 per share. The company, which primarily imports cotton and man-made fabrics from China and Hong Kong, plays a crucial role in the textile and garment manufacturing supply chain in Maharashtra. The IPO raised ₹11.88 crores, all of which is allocated to expanding working capital and general corporate purposes.

The NAPS Global India IPO

The NAPS Global India IPO, which took place from March 4 to March 6, 2025, was set at a fixed issue price of ₹90 per share. With 13.20 lakh shares offered through a fresh issue, the total market capitalization at the IPO price was ₹39.87 crores. Retail investors had to invest a minimum of ₹1,44,000 for 1,600 shares, while High Net-Worth Individuals (HNIs) needed to invest ₹2,88,000 for 3,200 shares.

Despite the grey market premium being ₹0 leading up to the listing, shares of NAPS Global India made a notable performance by opening 20% higher, reflecting investor confidence. The IPO subscription was 1.19 times oversubscribed, signaling strong market interest in the company. Aryaman Financial Services Limited managed the book running for the IPO, and Cameo Corporate Services Limited acted as the registrar.

Company Overview

NAPS Global India was founded in 2014, with its primary focus on the wholesale distribution of textiles. It has strong supplier networks across China and Hong Kong, which allows it to consistently provide high-quality fabrics and garments to garment manufacturers across India. The company’s product portfolio includes cotton fabrics, super-soft velvet fabrics, knitted fabrics, and garments such as women’s tops, men’s shirts, and kids’ jeans.

The company’s operational model relies on just-in-time inventory, which reduces warehousing costs while improving capital efficiency. This model, combined with strong market insights, ensures high demand and repeat business. As of August 2024, NAPS Global India employed just 10 people but had already established a dominant position in the Indian textile supply chain.

Investment Objectives and Use of Proceeds

The IPO proceeds are expected to be used primarily for working capital requirements (₹919 lakh) and general corporate purposes (₹169 lakh). This funding will help NAPS Global India improve its supply chain efficiency and expand its business.

Industry Landscape and Future Growth

The global textile market is experiencing robust growth, with a projected CAGR of 7.4% from 2023 to 2030, driven by increasing demand for fast fashion and technical textiles. NAPS Global India operates in a highly competitive space but differentiates itself through its strong supplier base and growing customer network in major textile hubs like Maharashtra, Gujarat, and Karnataka.

In addition to its strong position in fabric imports, NAPS Global India is strategically expanding into higher-margin readymade garments, with an outsourcing model to mitigate capital investment risks. The company's digital and e-commerce expansion will further enhance its market reach.

Risks and Challenges

NAPS Global India faces several risks, including high supplier concentration, with 98.83% of raw materials sourced from its top 10 suppliers in China. Revenue concentration risk is also a concern, as 50.84% of its revenue comes from the top 5 customers. Additionally, the company must manage working capital effectively to ensure smooth operations, especially in times of supply chain disruptions.

Conclusion

With its shares debuting at a 20% premium and the successful completion of its ₹11.88 crore IPO, NAPS Global India is poised to further strengthen its position in the Indian textile and garment supply chain. The company’s growth strategies, including geographic expansion and forward integration into garment manufacturing, position it for continued success in the fast-growing textile industry.

The Upcoming IPOs in this week and coming weeks are Super Iron Foundry, Paradeep Parivahan, Divine Hira Jewellers.

The Current active IPO is PDP Shipping & Projects.

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.