Borana Weaves IPO: Check IPO Date, Lot Size, Price & Details

Borana Weaves Limited is a textile manufacturer situated in Surat, India. The company specializes in the production of unbleached synthetic grey fabric. This grey fabric acts as a foundational material for subsequent processing steps like dyeing and printing, catering to various industries including fashion, traditional textiles, technical textiles, home décor, and interior design.

It primarily focuses on this single product line of grey fabric, enabling a concentrated approach within its specific market segment.

The company operates three manufacturing facilities equipped with advanced textile machinery, encompassing processes like texturizing, warping, water jet weaving, and fabric folding.

The company also manufactures polyester textured yarn (“PTY Yarn”), which is produced by heating polyester oriented yarn (“POY Yarn”), our raw material used in the production of grey fabric.

IPO Details:

Objectives:

• Financing the cost of establishing a new manufacturing unit at Surat, Gujarat, India, estimated at 71.34 Crores
• Funding incremental working capital requirements, estimated at 26.50 Crores
• General Corporate Purposes.

Strengths:

• Technological Advancements: It has made significant investments in state-of-the-art textile manufacturing technologies, including the deployment of 700 high-tech water jet looms. This investment supports high production efficiency and contributes to producing superior quality fabric.
• Specialized Product Focus: It primarily focuses on a single product line of grey fabric. This specialization allows the company to concentrate its efforts within a specific market segment and address niche customer needs with a focused strategy.
• Strong Market Reputation: It has established a solid reputation for quality and reliability within the textile industry. The company's commitment to high-quality craftsmanship and sustainable practices is reportedly well-regarded by its domestic customer base.
• Vertical Integration: The company has integrated key operations such as spinning and texturizing into its manufacturing process. This vertical integration is stated to improve control over the supply chain and enhance overall production efficiencies.

Risks

• Limited Operating History: The company was incorporated on October 28, 2020, and commenced operations immediately. With limited operating history, would may make it difficult to evaluate its future prospects and profitability.
• Geography-Specific Concentration Risk: Its manufacturing units, and a significant majority (90.00%) of its raw material suppliers (POY Yarn) are primarily located in Gujarat. This geographic concentration exposes the company to region-specific risks, such as labor unrest, violence, and natural or man-made disasters that could affect the state.
• Related Party Transactions and Dependency: A notable portion of the company's customer base includes entities forming part of the Promoter Group. For instance, in Fiscal 2023 and 2024, Borana Industries LLP was the top customer, and Borana Filaments Private Limited was among the top 5 customers. Such dependency on related party transactions could pose business risks.