Sanathan Textiles to Issue IPO of Rs 13 billion

Sanathan Textiles to Issue IPO of Rs 13 billion

Sanathan Textiles Limited is planning to raise Rs 12-13 billion through an initial primary offer for which it is likely to file a draft red herring prospectus (DRHP) with market regulator, Sebi.

Mumbai, Maharashtra

Sanathan Textiles Limited is planning to raise Rs 12-13 billion through an initial primary offer for which it is likely to file a draft red herring prospectus (DRHP) with market regulator, Sebi.

The issue would be a mix of fresh issuance and offer for sale (OFS) for existing shareholders, two sources close to the development said. Edelweiss Financial Services Limited and JM Financial Limited have been appointed as book-running lead managers to the issue, said one of the sources.

According to India Ratings and Research (Ind-Ra) report published in December, Sanathan Textiles’ margin expanded to 17.8% in the first half of FY 2022 owing to higher realisations, lower raw material prices and the management’s cost reduction initiatives. The company recorded operating earnings (Ebitda) of Rs 2.6 billion in 1HFY22 and the agency expects the same to be supported by higher volumes in FY22, with the completion of capex in cotton yarn, industrial drawn yarn (IDY) and Sanathan Polycot Pvt Ltd (SPPL). This will be the first IPO after a decade in the textile industry space.

The last mainboard textiles industry IPO was Pradip Overseas , which came out in 2010 raised Rs 1.16 billion, Yash Birla group’s textile manufacturing company, Birla Cotsyn raised Rs 1.44 billion in 2008, and Tamil Nadu-based apparel company KPR Mill raised Rs 1.33 crore in 2007.

Source: The Economic Times

Image Source: Google Images

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