An IPO is being launched by Cedaar Textile Ltd on the NSE Emerge SME platform, aiming to raise funds through a book-built issue. The offering includes up to ₹60.90 crore, comprising a fresh issue of 43,50,000 equity shares. There is no offer for sale (OFS) included in the issue.
Company Overview
Incorporation: September 28, 2020
Sector Focus: Engaged in the manufacturing of mélange yarns used in home textiles, woven fabrics, hosiery, and apparel manufacturing.
Operations: Focused on blending quality yarns with scalable production infrastructure and energy-efficient practices.
Lot Size & Investment Details
| Investor Type | Lots | Shares | Investment |
|---|---|---|---|
| Retail (Minimum) | 1 | 1,000 | ₹1,40,000 |
| Retail (Maximum) | 1 | 1,000 | ₹1,40,000 (capped by retail limit) |
| HNI (S-HNI) | 2 | 2,000 | ₹2,80,000 at upper band |
📊 Financial Highlights
| Financial Year (Ending March) | Total Revenue (₹ Cr) | Net Profit (₹ Cr) | Total Assets (₹ Cr) |
|---|---|---|---|
| 2021–22 | 220.44 | 7.99 | 154.45 |
| 2022–23 | 161.88 | 4.59 | 175.84 |
| 2023–24 | 191.01 | 11.05 | 198.23 |
📦 Issue Structure
- Issue Type: Book-built issue on SME platform
- Total Issue: 43,50,000 equity shares (Face Value: ₹10 each)
- Fresh Issue: Entire issue consists of fresh shares; no Offer for Sale (OFS) included
⚠️ Risks
Raw Material Price Volatility
The company is heavily dependent on cotton and synthetic fibres. Any significant fluctuations in raw material prices could affect profit margins and production costs.
Working Capital Intensive Operations
Textile manufacturing requires a high level of working capital. Delays in receivables or disruptions in cash flow could impact operations.
Highly Competitive Industry
The textile sector is highly fragmented and competitive, with pricing pressure from both domestic and global players. This may affect profitability and customer retention.
Limited Operating History as a Public Entity
The company recently converted to a public limited structure. As such, it may face challenges adapting to compliance, reporting standards, and governance requirements.
Dependence on Key Customers
A large portion of revenue may be derived from a few clients. Loss of major customers or order cancellations could significantly impact revenue.
Regulatory & Environmental Compliance
The textile industry is subject to strict pollution control norms and labor regulations. Any non-compliance could lead to penalties or production disruptions.
Economic Sensitivity
Demand for textile products is closely linked to overall economic conditions. Slowdowns, inflation, or changes in consumer spending could negatively impact demand.
Use of IPO Proceeds
Any delay, deviation, or inefficiency in deploying the IPO funds as planned (for machinery upgrades, solar installations, etc.) could affect the company’s growth plans.
📝 Summary
The company is launching an SME IPO of 43.5 lakh fresh equity shares to support operational upgrades, energy efficiency, and capital needs. With improving financial performance in FY24 and a focus on modernization, the offering targets long-term sustainability and scaled output. Details on price band, lot size, and final dates are awaited and should be tracked closely by potential investors.
