Powering Up Profits: Shree Ram Twistex Files IPO to Fuel Growth and Cut Debt

Shree Ram Twistex Ltd., a Gujarat-based cotton yarn manufacturer, has filed its Draft Red Herring Prospectus (DRHP) for an Initial Public Offering (IPO), signaling a bold stride toward expansion and financial optimization. The IPO comprises a fresh issue of 10.6 million equity shares, with proceeds earmarked for setting up captive power projects, repayment of existing loans, and general corporate purposes.

 

The company, known for its high-quality yarn used in denim, shirting, and suiting fabrics, plans to reduce its dependency on external power sources by investing in captive energy infrastructure. This move is expected to significantly lower operational costs and enhance sustainability. Additionally, the IPO funds will help pare down debt, improving the company’s balance sheet and credit profile.

 

Shree Ram Twistex has shown consistent growth, with FY24 provisional revenues reaching ₹229.12 crore, up from ₹214.88 crore in FY23. Profit margins have also improved, with PAT margins rising to 3.08% from 1.54% year-on-year. The company operates a 27,700-spindle facility in Gondal, Rajkot, and sources raw cotton from the Saurashtra region.

 

Backed by experienced promoters and a strong client base in Ahmedabad, the IPO is poised to attract investors looking for exposure to India’s resilient textile sector. With a stable credit rating of ACUITE BBB and A3+, the company’s fundamentals appear robust as it gears up for public listing.

 

Sources: Acuité Ratings, Shree Ram Twistex official website, ZaubaCore