Spunweb Nonwoven Limited, one of India’s leading manufacturers of PP (Polypropylene) spunbond nonwoven fabric, has launched its Initial Public Offering (IPO) to raise ₹60.98 Crores through a Book Built Issue. The issue opened for subscription on July 14, 2025, and will close on July 16, 2025. The allotment is expected on July 17, 2025, with a tentative listing on the NSE SME platform on July 21, 2025.

About the Company

Spunweb is based in Morbi, Gujarat, and is recognised as one of the largest production houses in India for spunbond nonwoven fabric.

They operate five advanced production lines spread across two state-of-the-art manufacturing units equipped with cutting-edge technology and advanced laboratories to maintain stringent quality standards.

Product Highlights:

• PP (Polypropylene) spunbond nonwoven fabric for multiple applications

• Focus on quality control and consistent output

• Strong domestic and export demand

Promoters and Management

• Jay Dilipbhai Kagathara and Kishan Dilipbhai Kagathara are the promoters, with deep industry knowledge and leadership in scaling production capacity.

• Yashpalsinh Ghanshyamsinh Dasondi, GM – Operations, brings 18+ years of expertise in nonwoven fabric production.

• Abhaykumar Narshibhai Fadadu, CFO, has 9+ years of experience in accountancy and financial management.

This experienced team has built a reputation for efficient manufacturing processes, strong customer relationships, and a diverse product portfolio.

IPO Details at a Glance

• Issue Size: ₹60.98 Crores

  • Fresh Issue: Entirely Fresh Issue of 63.51 lakh shares

• Price Band: ₹90 to ₹96 per equity share

• Market Capitalisation at ₹96/share: ₹231.39 Crores

• Lot Size: 1,200 shares

  • Retail Minimum Investment: 2 lots (2,400 shares = ₹2,30,400)

• IPO Open Date: July 14, 2025

• IPO Close Date: July 16, 2025

• Tentative Allotment Date: July 17, 2025

• Tentative Listing Date: July 21, 2025

• Exchange: NSE SME

Anchor Investor Participation

Spunweb Nonwoven raised ₹17.31 Crores from Anchor Investors at ₹96 per share, allocating 18,03,600 equity shares in consultation with Vivro Financial Services Private Limited, the Book Running Lead Manager.

This anchor book participation signals institutional confidence in Spunweb’s growth strategy and sector potential.

Book Running Lead Manager and Registrar

• Lead Manager: Vivro Financial Services Private Limited

• Registrar: MUFG Intime India Private Limited (Formerly Link Intime India)

• Market Maker: Rikhav Securities Limited

Grey Market Premium (GMP) Insight

As of 10 July 2025, the Grey Market Premium (GMP) for Spunweb Nonwoven IPO is ₹20, indicating an expected listing gain of ~20.83% over the upper price band of ₹96.

This premium suggests healthy demand in the unregulated grey market, although it must be noted that GMP trends are unofficial and can change quickly.

Live Subscription Status

As of 11:30 AM on July 15, 2025 (second day of subscription), the IPO was subscribed 14.63 times, reflecting strong investor interest across categories.

This high subscription indicates broad market confidence in Spunweb’s growth story and pricing strategy.

Company’s Financial Performance

Spunweb has shown consistent and strong growth in revenues and profitability:

• Revenues from Operations:

  • FY23: ₹11,768.01 Lakh

  • FY24: ₹15,424.12 Lakh

  • FY25: ₹22,713.95 Lakh

• EBITDA:

  • FY23: ₹1,256.35 Lakh

  • FY24: ₹2,063.49 Lakh

  • FY25: ₹3,201.51 Lakh

• Profit After Tax (PAT):

  • FY23: ₹112.68 Lakh

  • FY24: ₹544.18 Lakh

  • FY25: ₹1,079.22 Lakh

This steady growth trajectory underlines expanding production, operational efficiency, and strong market demand for nonwoven fabrics.

Valuation Metrics

• Pre-Issue EPS (FY24): ₹6.28

• Post-Issue EPS (FY24): ₹4.48

• Pre-Issue P/E Ratio: 15.28x

• Post-Issue P/E Ratio: 21.44x

These P/E multiples are reasonable and compare favourably with industry peers, suggesting the issue is fairly priced.

Return Ratios

• ROCE (FY24): 33.66%

• ROE (FY24): 31.63%

• RoNW: 31.63%

These robust return ratios indicate efficient capital allocation and healthy profitability, supporting investor confidence in Spunweb’s business fundamentals.

Objectives of the IPO

Spunweb plans to use Net Proceeds from the IPO for:

1. ₹2,900.00 Lakhs – Working capital requirements.

2. ₹1,000.00 Lakhs – Investment in wholly owned subsidiary (SIPL) for working capital.

3. ₹800.00 Lakhs – Repayment, in part or full, of existing borrowings.

4. General Corporate Purposes – For strategic needs and operational flexibility.

This allocation reflects a balanced approach to growth funding, debt reduction, and subsidiary support.

Strengths of Spunweb Nonwoven Limited

• Industry Leadership: Among India’s largest PP spunbond nonwoven fabric producers.

• Advanced Production Facilities: Cutting-edge technology ensures quality and scale.

• Strong Financial Growth: Revenue and profit CAGR highlight operational strength.

• Experienced Management: Promoters and leadership team with deep industry knowledge.

• Anchor Investor Confidence: Early institutional support reflects credibility.

• Healthy GMP Trend: Signals market interest in listing gains.

Risks and Considerations

• Raw Material Price Volatility: PP prices can affect margins.

• Sector Competition: Intense domestic and international players.

• SME Listing Volatility: NSE SME platform listings can have lower liquidity and higher price swings.

• Dependence on Working Capital: Heavy reliance on adequate cash flows for operations.

Investors should consider these factors when evaluating listing and long-term potential.

GMP Trend and Listing Outlook

The GMP of ₹20 as of July 10 suggests potential listing gains of ~20% over the issue price.

While grey market trends are unofficial, this premium reflects strong investor sentiment, particularly given high subscription levels.

Investor Perspective

Spunweb Nonwoven IPO offers exposure to a growing manufacturing sector in India with strong fundamentals, fair valuation, and robust financials.

• Short-Term Investors: The GMP and oversubscription indicate potential listing gains.

• Long-Term Investors: Steady financial performance, industry leadership, and expansion plans make it worth considering.

Given these factors, Risk-Tolerant Investors may Apply to Spunweb Nonwoven IPO, especially for listing gains.

Conclusion

Spunweb Nonwoven Limited IPO stands out among SME issues with:

• Strong revenue and profit growth

• High quality manufacturing capability

• Anchor investor support

• Healthy market interest (GMP and subscription)

While risks exist, particularly in raw material volatility and SME listing liquidity, the balanced IPO pricing and sector leadership make it an attractive proposition for investors seeking both short-term gains and long-term value.

Disclaimer:
This analysis is for educational and informational purposes only. It does not constitute investment advice or a solicitation to buy or sell any securities. Investors should perform their own due diligence or consult a SEBI-registered financial advisor before making any investment decisions. All data is based on information available as of the publication date and may be subject to change.

The Upcoming IPOs in this week and coming weeks are Savy Infra, Monika Alcobev, NSDL.

The Current active IPO are Anthem Biosciences, Spunweb Nonwoven.

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