Borana Weaves IPO Day 1: Issue booked 8.54x; retail portion subscribed 25x. Apply or not?

Borana Weaves IPO: Textile manufacturer Borana Weaves commenced its public subscription on Tuesday, May 20. Borana Weaves' IPO on May 19 secured ₹65.2 crore from 11 institutional investors through an anchor book, a day before the issue opening. The public offering will close on Thursday, May 22. Considering Borana Weaves IPO's upper limit of the price band, the firm anticipates raising approximately ₹144.89 crore from its initial public offering (IPO). Investors can bid for a minimum of 69 shares and in multiples of that number. Borana Weaves listing date is scheduled on Tuesday, May 27.

In its communication to the exchanges, the company announced the finalisation of 30,18,543 equity shares allocated to anchor investors at a price of ₹216 per equity share.

As per reports, among the 11 anchor investors were Pink Oal Global Fund, Innovative Vision Fund, Aarth EIF Growth Fund, Saint Capital Fund, Nexus Equity Growth Fund, and Sunrise Investment Trust.

Borana Weaves IPO price band has been fixed in the range of ₹205 to ₹216 per equity share of the face value of ₹10. Borana Weaves IPO has reserved not less than 75% of the shares in the public issue for qualified institutional buyers (QIB), not more than 15% for non-institutional investors (NII), and not more than 10% of the offer is reserved for retail investors.

Founded in 2020, Borana Weaves specializes in manufacturing unbleached synthetic grey fabric. This fabric acts as a basic material for further processing, like dyeing and printing, across various sectors such as fashion, traditional textiles, home decor, and interior design.

Borana Weaves IPO Subscription Status

The initial public offer of Borana Weaves IPO has been subscribed 8.54 times at the end of the first day of subscription, as per BSE data.

The initial share sale received bids for 3,15,01,122 shares against 36,89,457 shares on offer, at 17:00 IST, according to BSE.

The portion for retail investors received 25.00 times subscription while the quota for non-institutional investors got subscribed 11.55 times. The qualified institutional buyers (QIBs) has been booked 1.55 times. 

Borana Weaves IPO GMP today

Borana Weaves IPO GMP today is +55. This indicates Borana Weaves share price was trading at a premium of ₹55 in the grey market, according to investorgain.com.

Considering the upper end of the IPO price band and the current premium in the grey market, the estimated listing price of Borana Weaves share price is indicated at ₹271 apiece, which is 25.46% higher than the IPO price of ₹216.

Following the grey market activities over the past eight sessions, today's IPO GMP is showing an upward trend, indicating a promising listing. The minimum GMP recorded is ₹0.00, while the maximum GMP stands at ₹63.00, as per insights from experts at investorgain.com.

'Grey market premium' indicates investors' readiness to pay more than the issue price.

Borana Weaves IPO Review

Bajaj Broking report indicated that the company specializes in the production and marketing of unbleached synthetic grey fabrics for the B2B sector. It has experienced remarkable growth since FY23, reflected in both its revenue and profit. The transition from traditional methods to a water jet loom process has produced the expected advantages. According to its financial information, the issue seems to be fully valued. Savvy investors might consider investing for the medium term.

Additionally, the brokerage mentioned that over the past three fiscal years, the company has achieved an average EPS of Rs. 8.77 (simple average) and an average RoNW of 64%. The offering is valued at a P/BV of 5.63, calculated from its NAV of Rs. 38.40 as of December 31, 2024, and at a P/BV of 2.60 based on its post-IPO NAV of Rs. 83.11 per share (at the upper limit).

Anshul Jain, Head of Research at Lakshmishree Investment and Securities said that Borana Weaves IPO is a golden opportunity for investors eyeing the booming textile sector. Priced at ₹205–216 per share, this Surat-based company has shown remarkable growth, with revenue soaring from ₹42.36 crores in 2022 to ₹199.60 crores in 2024, and profits hitting ₹23.59 crores. 

“With a robust ROE of 49.45% and a reasonable P/E ratio of ~18.26, the IPO is attractively valued. Funds will fuel a new manufacturing unit, boosting capacity. Analysts recommend subscribing for long-term gains, supported by a strong grey market premium. Don’t miss this chance—subscribe now for potential listing gains and sustained growth!,”advised Jain.

Borana Weaves IPO Details

Borana Weaves IPO, which is worth ₹144.89 crore, comprises of fresh issue of 67,08,000 equity shares. There's no offer-for-sale (OFS) component.

The objective of Borana Weaves IPO is to utilize the net funds raised from the offering for various purposes, such as funding the creation of a new manufacturing facility to boost its production capacity for grey fabric in Surat, Gujarat, India; supplying extra working capital; and addressing general corporate expenses.

Beeline Capital Advisors Pvt Ltd is the book-running lead manager for the Borana Weaves IPO, while Kfin Technologies Limited functions as the registrar for this offering.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.