Shree Ram Twistex
IPO Size: Rs. 110 cr, Entirely Fresh Issue
- Rs. 44 cr working capital
- Rs. 39 cr for adding 4.2 MW wind energy capacity
- Rs 15 cr repayment of Rs. 61 cr gross debt
Price band: Rs. 95-104 per share
M cap: Rs. 416 cr, implying 26% dilution
- Retail allocation is only 10%, with 75% reserved for institutions
IPO Date: Mon 23rd Feb to Wed 25th Feb 2026, Listing Mon 2nd Mar 2026
Grey Market Premium (GMP): We are strongly against ‘grey market premium’ as it is an unofficial figure, against SEBI guidelines.
Gujarat based Yarn Producer
Shree Ram Twistex is a 13 year old B2B manufacturer of yarn, having a spinning facility in Rajkot, Gujarat with a spindle count of 27,744, entailing yarn production capacity of 9,855 MTPA. Of Rs. 250 cr revenue in FY25, 94% was domestic sales, mainly Gujarat, and balance was exports. Top 10 players account for over 80% of company revenue.
Mediocre Financials
Shree Ram Twistex has reported revenue CAGR growth of mere 7% in past 3 fiscals, which is below the country’s GDP growth. As it is not present in the entire value chain of textile manufacturing, margins remain slim, at ~3%, till FY25.
In H1FY26, on revenue of Rs.132 cr, PAT surged to Rs. 7 cr, resulting in 5.3% net margin, just prior to IPO. H1FY26 EPS stood at Rs. 2.38, as against FY25 EPS of Rs. 2.72. Total debt of Rs 61 cr will decline to Rs. 46 cr, with networth expanding from Rs. 81 cr to 190 cr, post IPO.
Unattractive Pricing
At upper end of Rs. 104, PE multiple works out to 11.5x, on H1FY26 annualised basis. This is expensive for a small B2B player with slim margins. Cash rich Ambika Cotton Mills, with Rs. 700 cr topline and 8-9% net margin, is trading at a PE of 12.8x.
In addition to lacklustre historic financials, company’s IPO document has error. Pg 352 of RHP wrongly mentions commencement of trading day as Wed 2nd Mar, instead of Mon.
22nd Feb 2026 at 06:56 pm